scholarly journals Financial Institutions’ Inter Mediation and Economic Development in Nigeria

2019 ◽  
Vol 5 (1) ◽  
pp. 33-46
Author(s):  
Grace Oyeyemi Ogundajo ◽  
Adegbemi Babatunde Onakoya ◽  
Enyi Patrick Enyi ◽  
Tunji T. Siyanbola
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Private Sector ◽  
Financial Institutions ◽  
Financial Institution ◽  
Causal Effect ◽  
Real Gdp ◽  
Long Run ◽  
Integration Test ◽  
Bound Test

This paper examines the effect of intermediation capacity of the financial institutions on the Nigerian economic development (Real Gross Domestic Product (RGDP). It is a causal-effect relationship study which made use of macro data obtained from Central Bank of Nigeria (CBN) Statistical Bulletin from the period 1981-2016. The result of the Johansen co-integration test and ARDL bound test evidenced that there exist a long-run relationship between financial institutions’ activities and real GDP. ARDL regression model showed financial institution activities, particularly the loans to the private sector significantly impacted on economic growth both in the short-run and long-run The study also found that bank loans and advances, bank reserves and interest rate had insignificant negative impact on real GDP while credit to private sector significantly affected economic development of Nigeria (RGDP) Thus, economic development of Nigeria is driven by the performance of deposit money banks and concludes that the performance of deposit money banks has effect on the economic development of Nigeria. The study recommended that the banking sector should increase lending to the private sector in order to engender economic growth through the enhancement of entrepreneurial development.

scholarly journals Examining the Causal Relationship between Private Sector Credit Extended and Economic Growth in Namibia

2019 ◽  
Vol 11 (2(J)) ◽  
pp. 23-29
Author(s):  
Andreas . ◽  
J P S Sheefeni
Keyword(s):  
Economic Growth ◽  
Private Sector ◽  
Granger Causality ◽  
Granger Causality Test ◽  
Test Results ◽  
Causality Test ◽  
Long Run ◽  
Integration Test ◽  
Stationarity Test ◽  
Lending Rates

The paper examined causality between Private Sector Credit Extension (PSCE) and Economic growth using quarterly data for the period 2000:Q1-2017:Q4, in Namibia. The variables employed were Gross Domestic Product (GDP), Private Sector Credit Extended, Broad Money Supply (M2) and lending rates. The study tested for stationarity in order to determine the order of integration. Furthermore, a co-integration test was conducted on different sets of variables to establish the long run relationship. Granger causality test was also conducted to establish the direction of the relationships between the variables. The results for the stationarity test showed a combination of different orders of integration. The co-integration test revealed a stable long-run relationship among the variables. The Granger causality test results revealed one-directional causality running from PSCE to GDP. Therefore, one can conclude that that change in private sector credit extended can help predict economic growth.

scholarly journals Does Financial Institution Support for Economic Growth? A Case of Nepal

2016 ◽  
Vol 12 ◽  
pp. 56 ◽  
Author(s):  
Bharat Ram Dhungana
Keyword(s):  
Economic Growth ◽  
Financial Institutions ◽  
Financial Institution ◽  
Financial System ◽  
Financial Reforms ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Domestic Credit ◽  
Short Run

<p>This paper examines the causality of economic growth and financial institutions with reference to Nepalese economy and determines whether financial institutions supports for economic growth or not. The empirical analysis shows that there is existence of long run association among the variables of gross domestic product (GDP), broad money (M2) and domestic credit to private sectors (DCPS). Moreover, vector error correction model (VECM) also suggests for the validity of the long run association among variables. The Granger causality and Wald statistics test do not find any short run causal relationship. The empirical result shows that there is a long-run association between financial institutions and economic growth of Nepal. Thus, a sound financial system helps to promote financial institutions in the country that supports for economic growth of the nation in the long run. The regulatory authority and financial institutions should accelerate financial reforms to improve the efficiency of financial system that helps to stimulate adequate capital formation and investment in the productive sectors.</p><p>Economic Literature Vol.12 2014: 56-68</p>

scholarly journals Causal Relationship Among Carbon Dioxide (CO2) Emissions, Renewable Energy, Population and Economic Growth in Bangladesh: An Empirical Study

2020 ◽  
Vol 11 (6) ◽  
pp. 196
Author(s):  
Shanjida Chowdhury ◽  
K. B. M. Rajibul Hasan ◽  
Mahfujur Rahman ◽  
K. M. Anwarul Islam ◽  
Nurul Mohammad Zayed
Keyword(s):  
Economic Growth ◽  
Carbon Dioxide ◽  
Economic Development ◽  
Renewable Energy ◽  
Carbon Dioxide Emissions ◽  
Long Run ◽  
Short Run ◽  
The Government ◽  
Carbon Dioxide Co2 ◽  
Bound Test

Developing countries face environmental degradation crisis due to the consumption of nonrenewable energy for economic development induces ecological destruction. However, the consequences of environmental deterioration can no longer be overlooked. Using data from 1990 from 2018, this study scrutinized the long-run equilibrium along with the trend among consumption of renewable energy, carbon dioxide emissions, Population, and economic growth in Bangladesh. This study reveals the significant cointegration of renewable energy with controlled variables using the ARDL bound test. Also, ECM with ARDL unrestricted version enables us to decide the speed of adjustment is 27.647% addressed for short-run elasticity in the long run. Stability and further diagnostic tests are performed for model post estimation and validation. Also, it needs further steps from the government side to promote renewable energy that boosts economic development.

scholarly journals The Relationship between Financial Development and Economic Growth: The Case of Turkey

2016 ◽  
Author(s):  
Müge Manga ◽  
Mehmet Akif Destek ◽  
Muammer Tekeoğlu ◽  
Erkut Düzakın
Keyword(s):  
Economic Growth ◽  
Private Sector ◽  
Trade Liberalization ◽  
Money Supply ◽  
Financial Development ◽  
Integration Test ◽  
Domestic Credit ◽  
The Impact ◽  
Bound Test ◽  
The Relationship

The relationship between financial development and economic growth and the direction of causality between them have been received a lot of attention recently by many scholars. It is also important to analyze this relationship and the direction of causality due to implications of policies. In this study the relationship between financial development, trade liberalization and economic growth for Turkey are examined using three different models. Model 1, 2 and 3 investigate the effect of domestic loans to the private sector and trade liberalization on GDP, the impact of the domestic credit provided by banks to the private sector and trade liberalization on GDP and the effect of M2 money supply and M2 trade liberalization on GDP, respectively. Data extracted from World Development Indicators. Autoregressive-Distributed Lag Bound Test (ARDL) is used as a co-integration test to determine the long run relationship between variables. In addition, Toda and Yamamoto (1995) is utilized to test the direction of causality between financial development and economic growth according to the three financial indicators such as domestic loans to the private sector, the domestic credit provided by banks to the private sector and M2 money supply. According to the results there is a unidirectional relationship from economic growth to domestic loans to the private sector and the domestic credit provided by banks to the private sector. Additionally, the results indicate that a bidirectional relationship exist between M2 money supply and economic growth.

scholarly journals ENERGY-GROWTH NEXUS: EVIDENCE FROM NIGERIA

2021 ◽  
pp. 8-14
Author(s):  
Umar Muhammad Dabachi ◽  
Suraya Mahmood
Keyword(s):  
Economic Growth ◽  
Energy Use ◽  
Energy Intensity ◽  
Causal Effect ◽  
Energy Price ◽  
Policy Recommendations ◽  
Causality Test ◽  
Long Run ◽  
Bidirectional Relationship ◽  
Bound Test

This study aims to investigate the causality relationships between energy use, energy intensity, energy price and economic growth. Regarding the data analysis, the study covered the period from 1980 until 2020. All relevant preliminary tests were conducted in order to validate the data before the main analysis. We deployed ARDL bound test of cointegration approach for long-run relationship, as well as the granger causality test proposed by Toda and Yamamota (1995). The empirical results showed the presence of long-run relationship among the variables. We also found that energy use and economic growth has a bidirectional relationship. Similarly, we observed a presence of another feedback causal effect between energy intensity and economic growth. Likewise, a bi-directional causal relationship exists between energy price and economic growth in the Nigerian economy. The study makes available policy recommendations in the last part of the paper. KEY WORDS: energy intensity, energy price, economic growth, Toda and Yamamota

scholarly journals Public Education Funding and Economic Growth IN Nigeria; ARDL-VECM and Causal Inference Approach

2021 ◽  
pp. 30-41
Author(s):  
Eugene Iheanacho ◽  
Chuks Nwaogwugwu
Keyword(s):  
Economic Growth ◽  
Public Education ◽  
Error Correction ◽  
Capital Expenditure ◽  
Causal Effect ◽  
Secondary Data ◽  
Education Funding ◽  
Distributed Lag ◽  
Long Run ◽  
Bound Test

Considering the enormous impact of poor standard of educational system in Nigeria over the years, the study investigated the effects of public education funding on economic growth in Nigeria from 1985 to 2019. The paper used secondary data sourced from both Central Bank of Nigeria Statistical Bulletin and World Bank’s Development Indicators 2019. The paper employed Auto-Regressive Distributed Lag co-integration, Error correction mechanism and granger-causality tests as technique for data analysis. The ARDL bound test co-integration results revealed that RRETE, RCETE and Inflation have positive relationship with Economic growth. However, RETE, SEDU and PRI have indirect influence on Economic growth in Nigeria. Statistically, only RRETE has a long run causal effect on economic growth. ARDL Error Correction Regression output showed that RETE and RCETE are significant at 10% level while PRI is significant at 5% level this indicates the existence of short run causal relationship with the establishment of ECM long run equilibrium adjustment speed. The causal results revealed unidirectional inference between SEDU and RETE, PRI and RETE, PRI and RRETE with no feedback effect. Therefore, the study recommended educational funding targeted at secondary and primary education system in order to acquire productive skills and knowledge to stimulate economic growth and development in Nigeria. There is need to meet the UNESCO funding ratio for both recurrent and capital expenditure on education sector.

Drying Development – The Causal Effect Droughts on (Long-Term) Economic Growth

2020 ◽  
Author(s):  
Alexander Marbler
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Causal Effect ◽  
Impulse Response Function ◽  
Grid Cell ◽  
Data Set ◽  
Standard Deviation Increase ◽  
Economic Agents ◽  
Long Run ◽  
Meteorological Observations

&lt;p&gt;Do droughts have a causal effect on economic development? Based on meteorological observations, I construct a global data set of drought events occurring in 183 countries over the period 1960-2018. Identifying the drought exposure for each of earth&amp;#8217;s 0.5&amp;#176; x 0.5&amp;#176; grid cell, I maintain the local information of drought shocks which economic agents experience. To identify the causal impact of droughts on long-run economic growth, I model economic growth as an impulse-response function in contemporaneous and historical area-averaged drought exposure. Exploiting the random natural variation in weather realizations as the source for exogenous within-country variation in drought exposure, I find that higher drought exposure causes slower economic development in poor, but not in rich, countries. National incomes in poor countries decline and keep declining 16 years following a drought. Specifically, a one standard deviation increase in drought exposure lowers GDP p.c. by 1.1 percentage points 16 years later. To understood why populations successfully adapt to climatic hazards in some dimensions and fail in others and which factors contribute to (successful) adaptation, I examine through which channels droughts affect economic development and estimate the extent of adaptation to drought.&lt;/p&gt;

scholarly journals Financial Deepening and Economic Development in MENA Countries: Empirical Evidence from the Advanced Panel Method

2017 ◽  
Vol 9 (4) ◽  
pp. 152
Author(s):  
Serife Ozsahin ◽  
Dogan Uysal
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Private Sector ◽  
Financial System ◽  
Estimation Methods ◽  
Financial Deepening ◽  
Mena Countries ◽  
Integration Test ◽  
Domestic Credit

This study analyses the effect of financial deepening on economic development in 12 MENA countries for the period between 2000 and 2014. Using three financial deepening indicators which are widely used in the literature, an econometric analysis was conducted through co-integration and estimation methods which take cross-sectional dependence into account. A long-term relationship between variables was revealed with Westerlund (2008) Durbin-Hausman panel co-integration test, and then, long-term coefficients were obtained using Pesaran (2006) CCE (Common Correlated Errors) estimator. Empirical findings point to a positive relationship between financial deepening indicators - domestic credit to private sector, domestic credit provided by private sector, and liquid liabilities of the financial system ratio – and economic development. With this study, it was shown that the domestic credit to private sector causes economic growth for five countries, domestic credit provided by financial sector causes economic growth for one country, and liquid liabilities of the financial system causes economic growth for four countries.

scholarly journals Nexus between Public Expenditure and Economic Growth in Nepal

2017 ◽  
Vol 40 (1-4) ◽  
pp. 28-43
Author(s):  
R. K. Shah ◽  
Tara Prasad Bhusal
Keyword(s):  
Economic Growth ◽  
Public Expenditure ◽  
Correction Term ◽  
Government Expenditure ◽  
Data Set ◽  
The Public ◽  
Real Gdp ◽  
Long Run ◽  
Bound Test ◽  
The Relationship

The article attempts to identify the relationship between public expenditure and economic growth in Nepal. Public expenditure is a fundamental element for the economic growth. On employing, ARDL bound test on data set for the period of 1975-2016, it is found that there in a long-run relationship between the public expenditure and economic growth. The bound test and error correction term clearly specify that there exists a long run relationship between government expenditure and economic growth in Nepalese economy. From the empirical study, it is found that government expenditure has significant influence on real GDP, which is proxy for economic growth. The study confirms the Keynesian theory of making government expenditure to boost economic growth of Nepal.

Electricity consumption and economic growth in ASEAN

2017 ◽  
Vol 5 (2) ◽  
pp. 16
Author(s):  
Ahmad Ghazali Ismail ◽  
Arlinah Abd Rashid ◽  
Azlina Hanif
Keyword(s):  
Economic Growth ◽  
Energy Use ◽  
Electricity Consumption ◽  
Panel Estimation ◽  
Real Gdp ◽  
Long Run ◽  
Bidirectional Relationship ◽  
Short Run ◽  
Using Data ◽  
The Relationship

The relationship and causality direction between electricity consumption and economic growth is an important issue in the fields of energy economics and policies towards energy use. Extensive literatures has discussed the issue, but the array of findings provides anything but consensus on either the existence of relations or direction of causality between the variables. This study extends research in this area by studying the long-run and causal relations between economic growth, electricity consumption, labour and capital based on the neo-classical one sector aggregate production technology mode using data of electricity consumption and real GDP for ASEAN from the year 1983 to 2012. The analysis is conducted using advanced panel estimation approaches and found no causality in the short run while in the long-run, the results indicate that there are bidirectional relationship among variables. This study provides supplementary evidences of relationship between electricity consumption and economic growth in ASEAN.

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