Financial development and economic growth in Ghana: Does the measure of financial development matter?

Adu, George; Marbuah, George; Mensah, Justice

doi:10.1016/j.rdf.2013.11.001

Cited by 273 publications

(248 citation statements)

References 15 publications

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“…Thus, according to these studies, financial development, bank-based or market-based, has a negative impact on economic growth. These studies include: Van Wijnbergen (1983); Buffie (1984); De Gregorio and Guidotti (1995); Adu et al (2013); Ujunwa and Salami (2010); and Bernard and Austin (2011), among others.…”

Section: Introductionmentioning

confidence: 99%

The Impact of Bank-Based and Market-Based Financial Development on Economic Growth: Time-Series Evidence From the United Kingdom

Nyasha

Odhiambo

2016

Glob. Econ. J.

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Section: Introductionmentioning

confidence: 99%

The Impact of Bank-Based and Market-Based Financial Development on Economic Growth: Time-Series Evidence From the United Kingdom

Nyasha

Odhiambo

2016

Glob. Econ. J.

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“…Several other studies have shown evidence of a negative association between the two (Adu et al, 2013;De Gregorio & Guidotti, 1995).…”

Section: Impact Analysismentioning

confidence: 88%

“…The thrust of the debate has been whether financial development has any impact on economic growth, and, if it has, whether the impact is positive or negative. To date, the overwhelming empirical evidence has been in favor of Schumpeter's (1911) Gregorio and Guidotti (1995), Bolbol, Fatheldina, & Omranb (2005) and Adu et al (2013) found evidence of a negative relationship between bank-based financial development and economic growth in certain isolated instances, while Ujunwa and Salami (2010) and Bernard and Austin (2011) provide evidence that market-based financial development has a negative impact on economic growth in certain countries.…”

Section: Review Of the Related Literaturementioning

confidence: 99%

“…Despite such overwhelming evidence, some studies conclude that bank-based and market-based financial development have a negative impact on economic growth (Adu et al, 2013;Bernard and Austin, 2011;Buffie, 1984;De Gregorio and Guidotti, 1995;Ujunwa and Salami, 2010;Van Wijnbergen, 1983). In addition to these two contrasting groups of empirical evidence, Australia, bank-based financial development, market-based financial development, economic growth…”

Section: Introductionmentioning

confidence: 99%

“…In the finance-growth literature, there is evidence in support of a positive relationship between financial development and economic growth (Akinlo & Akinlo, 2009;Adu, Marbuah, & Mensah, 2013;Bernard & Austin, 2011;Goldsmith, 1969;Hassan, Sanchez, & Yu, 2011;Kargbo & Adamu, 2009;King & Levine, 1993;Levine & Zervos, 1996;Odedokun, 1996). Despite such overwhelming evidence, some studies conclude that bank-based and market-based financial development have a negative impact on economic growth (Adu et al, 2013;Bernard and Austin, 2011;Buffie, 1984;De Gregorio and Guidotti, 1995;Ujunwa and Salami, 2010;Van Wijnbergen, 1983).…”

Section: Introductionmentioning

confidence: 99%

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Financial Systems and Economic Growth: Empirical Evidence from Australia

Nyasha¹,

Odhiambo²

2016

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163This paper examines the dynamic impact of both bank-and market-based financial development on economic growth in Australia during the period from 1980 to 2012. The study uses the autoregressive distributed lag (ARDL) bounds testing approach to examine this linkage. Unlike certain previous studies, this study uses both bank-and market-based financial development indices to measure the level of financial sector development in Australia. These indices were computed using the means-removed average method. The empirical results of this study show that while bankbased financial development has a short-run positive impact on economic growth in Australia, market-based financial development has no significant impact on economic growth, both in the short run and in the long run. These results imply that, in Australia, it is of paramount importance to concentrate on pro-banking sector policies, at least in the short run, to stimulate growth. IntroductionAlthough there is rich literature on the finance-growth nexus, the bulk of such literature is on the relationship between bank-based financial development and economic growth. Only a handful of studies provide coverage on the relationship between market-based financial development and economic growth. However, even in studies that have explored the economic growth impact of market-based financial development, the conclusions are far from conclusive.In the finance-growth literature, there is evidence in support of a positive relationship between financial development and economic growth (Akinlo & Akinlo, 2009;Adu, Marbuah, & Mensah, 2013;Bernard & Austin, 2011;Goldsmith, 1969;Hassan, Sanchez, & Yu, 2011; Kargbo & Adamu, 2009;King & Levine, 1993;Levine & Zervos, 1996;Odedokun, 1996). Despite such overwhelming evidence, some studies conclude that bank-based and market-based financial development have a negative impact on economic growth (Adu et al., 2013;Bernard and Austin, 2011;Buffie, 1984;De Gregorio and Guidotti, 1995;Ujunwa and Salami, 2010;Van Wijnbergen, 1983). In addition to these two contrasting groups of empirical evidence, Australia, bank-based financial development, market-based financial development, economic growth

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An alternate approach in exploring the causal link between financial development and economic growth—Evidence from advanced economies

Swamy

Dharani

2018

Int. J Fin Econ

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This study explores the causal link between financial development and economic growth in advanced economies as these countries experience significantly higher levels of financial development. Using a fully balanced panel of 24 economies from 1983 to 2013, the study shows that when imposing a linear relationship, the financial development and economic growth are negatively associated in the long run. The panel granger causality tests establish the bidirectional causality between the financial development variables with growth.Employing an alternate approach of moderated mediation effect framework, we notice that the association of financial development with economic growth is moderated by the negative impacts of inflation, interest rate, and population dependency; and the positive mediation effect of trade openness. The policy implication is that there is a need to rein in inflation and real interest rates and enhance trade openness to optimize the benefits of growing financial development on economic growth.

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Financial development and economic growth in Ghana: Does the measure of financial development matter?

Cited by 273 publications

References 15 publications

The Impact of Bank-Based and Market-Based Financial Development on Economic Growth: Time-Series Evidence From the United Kingdom

The Impact of Bank-Based and Market-Based Financial Development on Economic Growth: Time-Series Evidence From the United Kingdom

Financial Systems and Economic Growth: Empirical Evidence from Australia

An alternate approach in exploring the causal link between financial development and economic growth—Evidence from advanced economies

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