EMPIRICAL INVESTIGATION ON ECONOMIC GROWTH IN THE EUROPEAN UNION AND THE EURO AREA

The phenomenon of economic growth has become a top priority for many nations around the world, including the members of the European Union and the Euro Area. This article examines the impact of bank nonperforming loans on long-term economic growth for the period 2008‒2023. Our econometric models estimated with panel least squares, panel dynamic least squares, panel fully modified ordinary least squares and panel generalized method of moments (first difference) indicated a strong relationship between GDP growth rate and bank nonperforming loans across all models. Moreover, during the time span 2008‒2012, the members of the Euro Area registered a stronger impact of the predictor than EU members. The study stresses the importance of economic growth research endeavors and lists avenues for future research.