Macro-fi nancial linkage and fi nancial deepening in Chinese Taipei

The U.S. subprime mortgage crisis became apparent in the summer of 2007 and soon developed into a global fi nancial crisis and severe economic downturn. The world economic growth rate declined sharply from 3.02 percent in 2008 to −0.60 percent in 2009, and the average growth rate for advanced economies declined from 0.48 percent to −3.16 percent over the same two-year period (International Monetary Fund [IMF], 2010b).