Uticaj finansijskih tržišta na kvalitet makroekonomskih performansi Republike Srbije i zemalja Centralne Evrope

Developed and stable financial system is a key factor in economic development and one of the most important indicators of national economy development, which also indicates the participation of countries in international economic flows. It is undisputed that there is interdependence between economic development and financial system development, as confirmed by numerous empirical studies, because the optimal allocation of financial resources has a stimulating effect on the business sector efficiency and overall economic development. Financial market is a place of demands for diversification, in which the participants, at the micro level, want to ensure the optimal option for their business activities implementation, while at the macro level that provides a higher quality of macroeconomic performances. Financial stability ensures an efficient resources allocation and the achievement of key macroeconomic functions. Maintaining financial stability is necessary during prospective periods and in times of crisis, because the financial sector is an essential component of national economy, with a huge potential to strengthen and support economic growth or to undermine the economic stability of the country, whatgreat economic depressions through history confirmed. The financial system of European transition economies is not sufficiently developed, with a weak correlation between the financial system and the real economy, which has become particularly evident inconditions of modern economic crisis. Therefore, the aim of this dissertation is to examine financial system’s contribution to macroeconomic stabilization, especially in the conditions of transition to market economies in European countries, with reference to characteristics of developed market systems and specificity of their financial markets. The financial system in the Republic of Serbia is based on the dominance of banking sector, which was characterized by rapid growth in bank lending activity from 2003, until the outbreak of the Global crisis and the exposure to turbulence due to bad loans. That is the starting benchmark for research to find answers to the question of whether the development of the financial markets had an impact on the quality of macroeconomic performances in the previous thirteen–year transition period. Efficient functioning of the financial system provides the macroeconomic efficiency, while the better macroeconomic performances contribute to a more efficient financial system. Without developed financial markets and financial institutions, economic dynamics of modern market economies would show a negative trend in the long term. The aim of this dissertation is to review the experiences of modern market economies and selected countries of Central Europe (Abbreviation CE5 includes selected countries of Central Europe: Czech Republic, Hungary, Poland, Slovakia and Slovenia), examine the interdependence of the financial system and the macroeconomics performances and prospects of different ways of financing the economy of the Republic of Serbia