Financial innovation and economic growth in Bangladesh

Qamruzzaman, Md.; Jiang, Wei

doi:10.1186/s40854-017-0070-0

Cited by 73 publications

(75 citation statements)

References 65 publications

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“…We also observed that the elasticities of financial innovation toward economic growth were positively influenced in both the short-run and long-run periods. These findings align with Mwinzi (2014), Qamruzzaman and Jianguo (2017), and Beck et al (2014). Chou and Chin (2011) suggested that financial innovation increases the volume of financial product variety along with efficient financial services, eventually promoting financial-development-led economic growth.…”

Section: Conclusion and Recommendationssupporting

confidence: 80%

“…Research in the past decade has used bank credit to the private sector as a proxy indicator for financial innovation (e.g., Adu-Asare Idun and Aboagye 2014; Michalopoulos et al 2009). However, many empirical studies have used the ratio of broad-to-narrow money as a proxy for financial innovation (e.g., Bara and Mudxingiri 2016;Qamruzzaman and Jianguo 2017;Ansong et al 2011;Mannah-Blankson and Belnye 2004). This study followed the same path for investigation.…”

Section: Datamentioning

confidence: 99%

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Nexus between financial innovation and economic growth in South Asia: evidence from ARDL and nonlinear ARDL approaches

Qamruzzaman

Jiang

2018

Financ Innov

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This study examined the relationship between financial innovation and economic growth in Bangladesh, India, Pakistan, and Sri Lanka for the period Q1 1975 to Q4 2016. The autoregressive distributed lag (ARDL) bounds test was used to gauge long-run relationships, and the nonlinear ARDL (NARDL) test was used to explore asymmetry between financial innovation and economic growth in the sample of Asian countries. The findings from the bounds tests revealed long-run cointegration between financial innovation and economic growth in the sample countries. Furthermore, NARDL confirmed that positive changes in financial innovation linked positively with economic growth and vice versa in the long run. In the short run, however, the study found mixed behaviors in the case of positive and negative changes in financial innovation. To investigate directional causality, the Granger causality test under an error correction model was employed. The Granger causality results supported the feedback hypothesis in both the long run and short run. Thus, financial innovation boosts economic growth in the long run by stimulating financial service expansion, financial efficiency, capital accumulation, and efficient financial intermediation, which are essential for sustainable economic growth.

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Section: Conclusion and Recommendationssupporting

confidence: 80%

Section: Datamentioning

confidence: 99%

Nexus between financial innovation and economic growth in South Asia: evidence from ARDL and nonlinear ARDL approaches

Qamruzzaman

Jiang

2018

Financ Innov

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“…These study findings are supported by empirical studies conducted by Boubakari and Jin (2010); Coşkun et al (2017); and Pradhan et al (2014aPradhan et al ( , 2015. Furthermore, the finding of the long-run association between financial innovation and economic growth is also in line with Ajide (2015); Qamruzzaman and Wei (2017); and Bara and Mudzingiri (2016). Table 5.…”

Section: Ardl Bounds Testing For Cointegrationsupporting

confidence: 78%

“…To capture the financial innovation impact on economic growth, a larger number of studies repeatedly used broad to narrow money (M2/M1), where M1, known as narrow money, normally includes coins and notes in circulation and other money equivalents that are easily convertible into cash. M2 includes M1 plus short-term time deposits in banks and 24-h money market funds (see for example, Ansong et al 2011; Mannah-Blankson and Belnye 2004; ; Bara and Mudzingiri 2016;Arrau 1991;Qamruzzaman and Wei 2017).…”

Section: Variable Definition and Sourcesmentioning

confidence: 99%

Financial Innovation, Stock Market Development, and Economic Growth: An Application of ARDL Model

Qamruzzaman

Jiang

2018

IJFS

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This study aims to explore the relationship between economic growth, financial innovation, and stock market development of Bangladesh for the period 1980–2016. To investigate long-run cointegration, this study used the autoregressive distributed lagged (ARDL) bounds testing approach. In addition, the Granger-causality test is used to identify directional causality between research variables under the error correction term. Study findings from the ARDL bound testing approach confirm the existence of a long-run association between financial innovation, stock market development, and economic growth. Furthermore, the findings from the Granger-causality test support bidirectional causality between financial innovation, economic growth and stock market development, and economic growth both in the long run and short run. These findings support the theory that market-based financial development and financial innovation in the financial system can spur economic development.

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“…In addition to the results, in all other sectors except MC and CH sectors, causality relation was observed at different rates from credit interest rates to industrial production index. There are also some studies in the literature in which the causality relation from bank credits to industrial production index is partially or completely observed (Toby and Peterside, 2014;Chisasa, 2014;Rahman et al, 2015;Stolbov, 2017;Qamruzzaman and Jianguo, 2017) However, there are also studies in which the causality relationship from bank loans to industrial production index cannot be found (Dal Colle, 2011;Marques et al, 2013;Tripathi and Kumar, 2015;Adeola and Ikpesu, 2016). The casual relationship between the industrial production index and the bank credit volume and credit interest rates give clues that production is financed by bank loans.…”

Section: Resultsmentioning

confidence: 99%

A Micro Based Study on Bank Credit and Economic Growth: Manufacturing Sub-Sectors Analysis

Hacıevliyagil

Ekşi̇

2019

South East European Journal of Economics and Business

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The manufacturing sector plays an important role in the development of modern economy all over the world. Manufacturing -as a sub -sector of the industry-refers to the production of raw materials and other factors of production, such as labor, land and capital, or goods and services through the production process. With the multiplier effect, the share of the manufacturing industry sectors in the world value added is around 20%. Similarly, the sector also covers about 1 in 9 of the total employment in the world (UNIDO, 2017). As to put it, the share of the sector in GDP is also very high and crucial. For example, in Turkey, the average manufacturing industry share in total GDP is 40% but it varies yearly. While the shares of agriculture and service sectors in GDP were declining in years recently, the share of the industrial sector was increasing (BAT, 2017).To fully realize the importance of the industry in evaluating the above figures, the interaction between the other sectors of the industrial sector and other economic activities on the economy scale has been examined for many years. In the 1920s, British economist Allyn Young suggested that network-type connections between sectors of this type were the Nuri Hacievliyagil, Ibrahim Halil Eksi AbstractThis study examines the relationship between bank credits and performance and growth of manufacturing sub-sectors. Industrial Production Index was used for a different approach as a dependent variable. Indications of the autoregressive distributed lag (ARDL) bound co-integration test support the theory that bank credits are more effective than loan rates on industrial production of sub-sectors. Moreover, the increase in bank credit leads to the rise of industrial production in all the sub-sectors, except Machinery. According to the Toda Yomamato causality test results, there are different degrees of causalities in means of the importance of bank loans for industrial production. On the other hand, in all sub-sectors except machinery and chemical sub-sectors, causality relations were observed at different grades beginning from loan interest rates to industrial production. As a result, this study concludes with the evidence of supply leading hypothesis via the financial sector leads and causes economic growth.

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Financial innovation and economic growth in Bangladesh

Abstract: Background: This study provides evidence for the financial innovation in the financial system that resulted in the economic growth of Bangladesh from 1980-2016.

Cited by 73 publications

References 65 publications

Nexus between financial innovation and economic growth in South Asia: evidence from ARDL and nonlinear ARDL approaches

Nexus between financial innovation and economic growth in South Asia: evidence from ARDL and nonlinear ARDL approaches

Financial Innovation, Stock Market Development, and Economic Growth: An Application of ARDL Model

A Micro Based Study on Bank Credit and Economic Growth: Manufacturing Sub-Sectors Analysis

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