Long-Term Financial Development Model According to Economic Growth in Iran

2014 ◽  
Vol 3 (2) ◽  
pp. 86-92
Author(s):  
Nahid Salari ◽  
Mohammad Hassanzadeh ◽  
Habib Ebrahimpour ,
Keyword(s):  
Economic Growth ◽  
Financial Development ◽  
Development Model

Investigating the Roles of Physical Infrastructure, Financial Development and Human Capital on Economic Growth in Bangladesh

2020 ◽  
Vol 12 (2) ◽  
pp. 154-175
Author(s):  
Faroque Ahmed ◽  
Md. Jamal Hossain ◽  
Mohammad Tareque
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Financial Development ◽  
Causality Test ◽  
Distributed Lag ◽  
Dynamic Relationship ◽  
Autoregressive Distributed Lag ◽  
Physical Infrastructure ◽  
Long Term Impact

This article investigates the dynamic relationship among physical infrastructure, financial development, human capital and economic growth in Bangladesh, employing Autoregressive Distributed Lag (ARDL) bound co-integration and Granger causality test for the period 1985–2019. The study finds a significantly positive long-term impact of physical infrastructure and human capital on economic growth. However, the effect of financial development on growth is found to be negative, and the result suggests that financial development will take place with economic growth. From the policy perspective, this study emphasises increasing investment in physical infrastructure and human capital for Bangladesh to foster long-term economic growth.

scholarly journals Direction of Causality between Financial Development and Economic Growth in Turkey

2021 ◽  
pp. 22-37
Author(s):  
Cengiz Yılmaz ◽  
Banu Demirhan
Keyword(s):  
Economic Growth ◽  
Time Series ◽  
Gross Domestic Product ◽  
Financial Development ◽  
The Other ◽  
Development Indicators ◽  
Short Run ◽  
Causality Relationship ◽  
Using Data

This paper has investigated the causality relationship between financial development and economic growth in Turkey, using data from 2005:04 to 2020:03. We construct a time-series model to explore causality relationships between the variables. In the study, two indicators were used as financial development indicators: banking loans to the private sector and money supply to GDP (Gross Domestic Product). The empirical results have represented a bi-directional relationship between financial development and economic growth in the short run. On the other hand, we have not found a causality relationship in the long term.

scholarly journals The Financial Development And Economic Growth Nexus: The Role Of Saudi Arabian Financial Institutions

2019 ◽  
Vol 4 (6) ◽  
Author(s):  
Adel Bogari
Keyword(s):  
Economic Growth ◽  
Saudi Arabia ◽  
Financial Development ◽  
Financial Institutions ◽  
Generalized Method Of Moments ◽  
Democratic Accountability ◽  
Law And Order ◽  
Private Credit

The purpose of this paper is to assess the effects of the financial development and the financial institutions quality on the economic growth for the Saudi Arabia. Using generalized Method of Moments (GMM) with a dynamic panel framework, this paper employs different measures of financial development namely the Liquid liabilities (LIQ), Private credit by deposit money banks and other financial institutions (CRE) and Central bank assets (ASS), and for financial institutions quality including socioeconomic conditions, investment profile, law and order, corruption, external conflicts and democratic accountability. For the period (1990-2017), our findings strongly support the hypothesis that financial development leads to growth in the Saudi Arabia. Moreover, empirical results support a positive and significant relationship observed between financial institutions quality and growth. The findings of this paper suggest the need to give more support to the financial development for Saudi Arabia banking that have been launched in the country since the last three decades and to improve the role played by the financial institutions to stimulate saving/investment and, consequently, long-term economic growth.  

scholarly journals Test FOR Dynamic Relationship between Financial Development and Economic Growth in Malaysia: A Vector Error Correction Modeling Approach

2007 ◽  
Vol 9 (1) ◽  
pp. 61 ◽  
Author(s):  
Rosilawati Amiruddin ◽  
Abu Hassan Shaari Mohd Nor ◽  
Ismadi Ismail
Keyword(s):  
Economic Growth ◽  
Error Correction ◽  
Financial Development ◽  
Impulse Response Function ◽  
Vector Autoregressive ◽  
Vector Error Correction ◽  
Dynamic Relationship ◽  
Vector Error ◽  
Error Correction Modeling

This paper purports to study the effectiveness of financial development to Malaysian economic growth utilizing quarterly data. In view of the priority given to dynamic relationship in conducting this study, Vector Autoregressive (VAR) method which encompasses Johansen-Juselius’ Multivariate cointegration, Vector Error Correction Model (VECM), Impulse Response Function (IRF), and Variance Decomposition (VDC) are used as empirical evidence. The result reveals a short-term and long-term dynamic relationship between financial development and economic growth. The importance of financial sector in influencing the economic activity is proven as a clear policy implication.

scholarly journals Financial Development, Clean Energy, and Human Capital: Roadmap towards Sustainable Growth in América Latina

Energies ◽  
2021 ◽  
Vol 14 (13) ◽  
pp. 3763
Author(s):  
Pablo Ponce ◽  
José Álvarez-García ◽  
Johanna Medina ◽  
María de la Cruz del Río-Rama
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Renewable Energy ◽  
Energy Consumption ◽  
Financial Development ◽  
Clean Energy ◽  
Sustainable Growth ◽  
Policy Implications ◽  
Renewable Energy Consumption

The consumption of renewable energy has become a substitute for fossil fuels to mitigate environmental degradation. However, this substitution of energy raises many questions regarding its possible impact on economic growth. In this context, this research aims to examine the long-term relationship between economic growth and financial development, non-renewable energy, renewable energy, and human capital in 16 Latin American countries. Panel data techniques during the period 1988–2018 and statistical information compiled by the World Bank and Penn Word Table databases were used. Second-generation econometric techniques (cross-sectionally augmented Dickey–Fuller (CADF) and cross-sectionally augmented IPS (CIPS) were used in the work methodology, which allow the presence of cross-sectional dependence between sections to be controlled. The main results indicate that there is a long-term equilibrium relationship between financial development, non-renewable energy consumption, renewable energy consumption, human capital, and economic growth. The results show that the consumption of renewable energy does not compromise economic growth; the 1% increase in renewable energy consumption is related to the 1% increase in economic growth. The policy implications suggest some measures to ensure economic growth considering the role of green energy and human capital.

scholarly journals How does Financial Development and Petroleum Price cause Trade Openness in Pakistan?

2021 ◽  
Vol 3 (1) ◽  
pp. 42-60
Author(s):  
Damian Honey
Keyword(s):  
Economic Growth ◽  
Private Sector ◽  
Financial Development ◽  
Trade Openness ◽  
Oil Prices ◽  
Terms Of Trade ◽  
The Past ◽  
Petroleum Price ◽  
Yearly Data

In the past financial development and petroleum prices have been identified as acrucial factor influencing economic growth. This provoked us to explore the way financial development and petroleum prices influence the trade openness in Pakistan. The sample of yearly data is collected from 1980 to 2016 in order to apply ARDL cointegration method. Our results reflect the presence of long term cointegration between trade openness and its factors. This suggest that with the rise in credit in private sector there is eventual impact on imports and exports whereas the international petroleum prices also impact the same by pushing the prices of goods. Hence it is recommended that hedging the oil prices and the expansion of credit in Pakistan is worthwhile in terms of trade openness.

scholarly journals Financial Development and Economic Growth in Kenya: Evidence from the Asymmetric Autoregressive Distributive Lag

2021 ◽  
Vol 04 (05) ◽  
Author(s):  
Duncan O. Hongo ◽  
◽  
Liu Jie Consolata Wairimu Nderitu
Keyword(s):  
Economic Growth ◽  
Financial Development ◽  
Financial Risk ◽  
Government Expenditure ◽  
Capital Formation ◽  
Long Run ◽  
State Expenditure ◽  
Positive Shock ◽  
Risk Managers

Appropriate changes in financial development are largely known to cause growth. Inflation, gross capital formation and government expenditure, believably, succinctly controls the effects and causes long term growth. This paper analyzed this effects for Kenya paying exceptional attention on their asymmetric effects. The most reliable and important results supported that positive asymmetries of financial development increases long run growth unlike the negative with reducing and weak effects. However, in case of financial dynamics and instabilities, economic growth responds negatively with a steep slump to shocks by declining financial development as positive gross capital formation shocks seems to plausibly control such nonlinear dynamics and positively causing growth. Also, sustainable inflation and prudent state expenditure spurs long term growth. Since this growth finance relationship supports the supply-leading hypothesis, there is need for specific financial development policies which would alongside support sustainable inflation and prudent expenditure if they are to spur real growth. Moreover, the financial risk managers are required to robustly prepare against the negative shocks by finance that have greater degenerating effects than by upturn from the positive shock.

Deregulation, Financial Development and Economic Growth in Mexico: Long-Term Effects and Causality

2008 ◽  
Author(s):  
Miguel A. Tinoco Zermeno ◽  
Víctor Hugo Torres Preciado ◽  
Francisco Venegas-Martínez
Keyword(s):  
Economic Growth ◽  
Financial Development ◽  
Long Term Effects

Financial development and economic growth in GCC countries

2014 ◽  
Vol 41 (6) ◽  
pp. 493-514 ◽  
Author(s):  
Rihab Grassa ◽  
Kaouthar Gazdar
Keyword(s):  
Economic Growth ◽  
Financial Development ◽  
Financial System ◽  
Generalized Least Squares ◽  
Islamic Finance ◽  
Financial Reforms ◽  
Content Type ◽  
Gcc Countries ◽  
Operating Side

Purpose – The purpose of this paper is to compare the effects of Islamic financial development and conventional financial development on the economic growth for five GCC countries (Bahrain, Kuwait, Qatar Saudi Arabia and UAE). Design/methodology/approach – Using generalized least squares, OLS and panel data frameworks, this paper employs different measures of financial development for the period (1996-2011). Findings – Empirical results strongly support the hypothesis that Islamic finance leads to growth in the five GCC countries, however, no significant relationship observed between conventional financial development and growth. Practical implications – The findings of this paper suggest the need to accelerate the financial reforms for Islamic finance that have been launched in the region since the last decade and to improve the efficiency of these countries’ Islamic financial systems to stimulate saving/investment and, consequently, long-term economic growth. Originality/value – This study has several contributions to the existing literature. To the best of the authors’ knowledge, this paper is the first study that examines empirically the effect of Islamic finance on economic growth in GCC countries. As well, this paper is the first to compare the different effects of Islamic finance and conventional finance on economic growth on a context of countries having the most developed Islamic financial system in the world operating side-by-side with a conventional financial system.

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