Recently, much attention is given to financial-growth nexus, but largely via the physical capital accumulation channel. This study differed by examining this nexus, via the human capital accumulation channel in the ECOWAS region. It employed panel cointegration approaches as well as the FMOLS, DOLS. The results revealed that bank private credit and domestic private credit contribute significantly to economic growth in the ECOWAS, both directly and through their influence on human capital accumulation. These results imply that providing access to credit to both enterprises and individuals, through appropriate financial policies, will encourage economic growth in the ECOWAS region.
In recent years, the Thailand economy has become more open to foreign trade as well as foreign direct investment (FDI). Thus, the main objective of this article is to examine whether FDI and international trade have positively contributed to the economic growth of Thailand. The results of the Granger causality tests indicate that they are indeed important determinants of growth in Thailand. This suggests that policymakers in Thailand should liberalize its economy to encourage foreign trade and FDI inflows to achieve a sustained high economic growth.
The cointegration technique is used to examine the long‐run and short‐run relationships between the real Malaysian trade balance with the real exchange rate, domestic and world incomes. The results suggest that a real ringgit exchange rate depreciation improves the trade balance in the long run. World and domestic incomes are also found to be important determinants of trade balance. The significance of world income on trade balance indicates that Malaysia is prone to external shocks. An error‐correction model is then estimated to study the short‐run dynamics of the effects of exchange rate. The impulse response analysis shows that the effect of exchange rate on the trade balance lasts for about three years. A devaluation of ringgit will initially improve the trade balance, albeit small, after which the trade balance starts to deteriorate, and then improves again suggesting that there exists a delayed J‐curve.Trade balance, ringgit, real exchange rate, Malaysia, F32, F40, F41,
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