Direction of Causality Between Financial Development and Economic Growth. Evidence for Developing Countries

Borlea, Sorin Nicolae; Codruta, Mare; Achim, Monica Violeta; Puşcaş, Adriana

doi:10.1515/sues-2016-0006

Cited by 11 publications

(9 citation statements)

References 37 publications

(26 reference statements)

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“…In addition to unidirectional nexus, bi-directional causality was found in many studies. Demetriades and Hussein (1996), Hassan et al (2011), Borlea et al (2016) did researches on worldwide scale. Demetriades and Hussein (1996) covered only 16 countries and mainly used banking indicators to represent for financial development.…”

Section: Bi-directional Causalitymentioning

confidence: 99%

Financial depth and economic growth: Empirical evidence from ASEAN+3 countries

Lê¹,

Ho²,

Vu³

2019

10.5267/j.msl

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Nexus between financial depth and economic growth has been studied for long time and still attracts great attention from policymakers. This research examines the relationship among ASEAN+3 countries from 2000 to 2014 based on Cobb-Douglas theoretical framework. The results show that financial depths measured by domestic credit to private sector, M3 and stock market capitalisation all have significant effects on economic growth. The paper also gives policy recommendations to promote financial development for purposes of long-term economic growth in ASEAN+3 countries.

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Section: Bi-directional Causalitymentioning

confidence: 99%

Financial depth and economic growth: Empirical evidence from ASEAN+3 countries

Lê¹,

Ho²,

Vu³

2019

10.5267/j.msl

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“…A fiscal policy is determined through the legislative bargaining. The relationship between economic growth and financial market development is analyzed by Borlea et al (2016)…”

Section: Literature Reviewmentioning

confidence: 99%

What Drives Economic Growth in Some CEE Countries?

Simionescu

2018

Studia Universitatis „Vasile Goldis” Arad – Economics Series

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Considering the potential factors that might generate economic growth, a target for any economy, this paper identified some determinants of economic growth in the countries from Central and Eastern Europe (CEE countries) that are member states of the European Union. The foreign direct investment was the most important determinant of economic growth in most of the countries (Bulgaria, Slovenia, Estonia, Hungary, Romania, Poland, Latvia, Lithuania) in the period 2003-2016, according to Bayesian bridge regressions. The indicators related to the level and the quality of labour resources proved to be insignificant in explaining the economic growth in these countries. Moreover, in Croatia, Estonia, Latvia, Lithuania, and Poland, the government expenditure on education had a negative effect on economic growth.

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“…The commercialization of inventions and entrepreneurial opportunities will aid economic development (Fritsch, 2017). Borlea et al (2016) conclude that there exist correlations between financial markets and economic development in some regions while there exists no short, medium nor long term connection between financial markets and economic development in other regions. Developing countries and Sub-Saharan Africa exhibit a maximum correlation between the financial market and economic development irrespective of the financial market indicator used.…”

mentioning

confidence: 76%

Ease of Doing Business and Capital Market Development in a Demand Following Hypothesis: Evidence from ECOWAS

Nageri

2020

Studia Universitatis „Vasile Goldis” Arad – Economics Series

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Capabilities of African businesses in a transformative role in solving the continent‘s challenges are underestimated and misunderstood. This study examined ease of doing business and financial development from a demand following hypothesis in the West African sub-region, employed Structural Equation Model covering the period of 2004 - 2017. Ten ease of doing business indicators and five distinct financial (capital market) development variables from the World Bank database were used. Findings indicate weak demand following the hypothesis of capital market development: positive and negative, depending on the measure of capital market development from the ease of doing business for West African countries majorly because of inadequate electricity. The indirect effect of the construction permit, property registration, access to credit, minority investors‘ protection and cross-border trading are indirectly significant to capital market development while starting a business, tax-paying, contract enforcement and settling insolvency are insignificant. The study recommended roadshow by West African capital markets to improve the listing of companies and the government should improve on the electricity supply.

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Direction of Causality Between Financial Development and Economic Growth. Evidence for Developing Countries

Cited by 11 publications

References 37 publications

Financial depth and economic growth: Empirical evidence from ASEAN+3 countries

Financial depth and economic growth: Empirical evidence from ASEAN+3 countries

What Drives Economic Growth in Some CEE Countries?

Ease of Doing Business and Capital Market Development in a Demand Following Hypothesis: Evidence from ECOWAS

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