Download or read book Stock Market Performance and Economic Growth A Causality Test Approach written by Danson Kimani and published by LAP Lambert Academic Publishing. This book was released on 2012-07 with total page 80 pages. Available in PDF, EPUB and Kindle. Book excerpt: The investigation of the causal relationship between stock market performance and economic growth was conducted using the popular Granger causality test based on the Vector Autoregressive (VAR) model. The statistical techniques used include the unit root Augmented Dickey Fuller test in order to fulfill the objective of stationarity for all the time series in their levels and first differences. The Johansen co-integration test was used to investigate whether the variables are cointegrated of the same order taking into account the trace statistics and the maximum eigen-value tests. The variables were found to be cointegrated with at least one co-integrating vectorThe findings imply that the causality between economic growth and stock market runs unilaterally or entirely in one direction from the NSE 20-share index to the GDP. From the results, it was inferred that the movement of stock prices in the Nairobi stock exchange reflect the macro-economic condition of the country and can therefore be used to predict the future path of economic growth. Therefore, policy makers should facilitate proper growth of the stock exchange market in order to foster a thriving economic climate.

Download or read book An Examination of the Role of Stock Market Development in Economic Growth in SADC written by Taimi Amunkete and published by . This book was released on 2021 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This thesis examines the impact of stock market development on economic growth in five SADC countries, namely Botswana, Malawi, Mauritius, Namibia, and South Africa for the period starting from 2004 to 2019. It tests for the existence of a long-run relationship as well the presence of a causal relationship between stock market development and economic growth. The study selects interactions of stock market development with the real economy using panel vector autoregression (VAR) based Granger causality tests as well as impulse response functions and forecast error variance decomposition to interpret the results. Using stock market capitalization, total value traded and stock market turnover as measures of stock market development, the study aims to determine whether these variables have an impact on GDP growth. The results suggest that there is no cointegration among the variables, suggestive of the fact that there exists no long run relationship. In terms of the short-run causal relationships, the Pairwise Granger Causality tests reveal that there is evidence of a short-term unidirectional causal relationship between stock market development and economic growth, running from stock market development to GDP growth. These results are consistent with the supply leading hypothesis, as was originally postulated by Schumpeter (1911). Also commonly referred to as the finance-led growth hypothesis or the finance-growth nexus, it assumes that causality flows from financial sector development to economic growth and not the other way round; and thus, stock market development is deemed the driver of economic growth. Given the importance of stock market development to economic growth, the study recommends prioritisation of stock market activities in the form on government policy interventions, diversification of stock market products and automation of trading system to ensure enhanced performance of stock markets, as a driver for increased economic growth.

Download or read book Stock Markets and Economic Growth written by Alovsat Muslumov and published by . This book was released on 2006 with total page 8 pages. Available in PDF, EPUB and Kindle. Book excerpt: This article examines causality relationships between stock markets and economic growth based on the time series data compiled from 20 countries for the years 1981 through 1994. Sims' causality test based on Granger definition of causality was used. At first, panel data covering all countries over the entire analysis period were used to detect the direction of causation. Secondly, causal relations were investigated for each country,in isolation, using the respective time series data.Analysis based on the panel data revealed a two-way causation between stock market development and economic growth. Country analyses, on the other hand, could not lead to precise conclusions, but suggested a somewhat stronger link between stock market development and economic growth in developing countries.

Download or read book Stock Market Development and Long Run Growth written by Sara Zervos and published by . This book was released on 2016 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt: Is there a strong empirical association between stock market development and long-term economic growth? Cross-country regressions suggest that there is a positive and robust association.Levine and Zervos empirically evaluate the relationship between stock market development and long-term growth. The data suggest that stock market development is positively associated with economic growth. Moreover, instrumental variables procedures indicate a strong connection between the predetermined component of stock market development and economic growth in the long run.While cross-country regressions imply a strong link between stock market development and economic growth, the results should be viewed as suggestive partial correlations that stimulate additional research rather than as conclusive findings. Much work remains to be done to shed light on the relationship between stock market development and economic growth. Careful case studies might help identify causal relationships and further research could be done on the time-series property of such relationships.Research should also be done to identify policies that facilitate the development of sound securities markets.This paper - a product of the Finance and Private Sector Development Division, Policy Research Department - is part of a larger effort in the department to study the relationship between financial systems and economic growth. The study was funded by the Bank's Research Support Budget under the research project Stock Market Development and Financial Intermediary Growth (RPO 679-53).

Download or read book stock market development and long run growth written by Ross Levine and published by World Bank Publications. This book was released on 1996 with total page 32 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book An Empirical Investigation of Stock Markets written by Shigeyuki Hamori and published by Springer Science & Business Media. This book was released on 2012-12-06 with total page 140 pages. Available in PDF, EPUB and Kindle. Book excerpt: An Empirical Investigation of Stock Markets: The CCF Approach attempts to make an empirical contribution to the literature on the movements of stock prices in major economies, i.e. Germany, Japan, the UK and the USA. Specifically, the cross-correlation function (CCF) approach is used to analyze the stock market. This volume provides some empirical evidence regarding the economic linkages among a group of different countries. Chapter 2 and Chapter 3 analyze the international linkage of stock prices among Germany, Japan, the UK and the USA. Chapter 2 applies the standard approach, whereas Chapter 3 uses the CCF approach. Chapter 4 analyzes the relationship between stock prices and exchange rates. Chapter 5 analyzes the relationship among stock prices, exchange rates, and real economic activities. Chapter 6 summarizes the main results obtained in each chapter and comments on the possible directions of future research.

Download or read book An Empirical Examination of Stock Market Growth in the Emerging Economies 1980 2000 written by Kamal A. El-Wassal and published by . This book was released on 2002 with total page 256 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Examining the Impact of Stock Market Development on Economic Growth written by Pramod Kumar Naik and published by . This book was released on 2014 with total page 33 pages. Available in PDF, EPUB and Kindle. Book excerpt: This study empirically reexamines the impact of stock market development on economic growth using data on twenty-seven emerging market economies over the period 1995-2012. We use market capitalization, trade value and turnover ratio as indicators of stock market development. Also, we construct three alternate composite indices of stock market development and used them in the growth regression each at a time. Methodologically, we employ the dynamic panel 'system GMM' estimators which is free from the problem of endogeneity and measurement errors; secondly, a 2nd generation panel unit root test of Pesaran (2007) is employed to test the stationary properties of data; finally, in order to test the direction of causality we make use of a newly developed panel non-causality test of Dumitrescu and Hurlin (2012) which is designed for heterogeneous panel. Our empirical findings indicate that stock market development significantly contributes to economic growth. This is evident in all the three alternate indices of financial development employed in the study. Further, we find a unidirectional causation running from stock market development to economic growth, supporting the supply-leading hypothesis. We also find that macroeconomic variables, such as investment ratio, trade openness and exchange rate have strong influence on economic growth. Thus, the study suggests that significant improvement of stock markets, making the economy internationally open, and improving the aggregate investment the emerging market economies can improve their economy.

Download or read book Financial Development and Economic Growth written by Mr.Pablo Emilio Guidotti and published by International Monetary Fund. This book was released on 1992-12-01 with total page 38 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the empirical relationship between long–run growth and the degree of financial development, proxied by the ratio of bank credit to the private sector as a fraction of GDP. We find that this proxy enters significantly and with a positive sign in growth regressions on a large cross–country sample, but with a negative sign using panel data for Latin America. Our findings suggest that the main channel of transmission from financial development to growth is the efficiency of investment, rather than its volume. We also present a model where the negative correlation between financial intermediation and growth results from financial liberalization in a poor regulatory environment.

Download or read book Stock Market Development and Economic Growth written by Guglielmo Maria Caporale and published by . This book was released on 2002 with total page 21 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Structural Changes and their Econometric Modeling written by Vladik Kreinovich and published by Springer. This book was released on 2018-11-24 with total page 784 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book focuses on structural changes and economic modeling. It presents papers describing how to model structural changes, as well as those introducing improvements to the existing before-structural-changes models, making it easier to later on combine these models with techniques describing structural changes. The book also includes related theoretical developments and practical applications of the resulting techniques to economic problems. Most traditional mathematical models of economic processes describe how the corresponding quantities change with time. However, in addition to such relatively smooth numerical changes, economical phenomena often undergo more drastic structural change. Describing such structural changes is not easy, but it is vital if we want to have a more adequate description of economic phenomena – and thus, more accurate and more reliable predictions and a better understanding on how best to influence the economic situation.

Download or read book Stock Market Growth Relationship in an Emerging Economy written by Tomiwa Sunday Adebayo and published by . This book was released on 2020 with total page 15 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper tends to establish the short and long run dynamics between stock market and GDP growth in Nigeria utilizing yearly data spanning between 1989 and 2017. The paper deployed the ARDL, FMOLS, DOLS, Toda Yamamoto causality and the variance decomposition techniques to verify these dynamics. The ARDL Bounds test reveals evidence of cointegration in the long run among the variables. The ARDL estimate reveals market capitalization of listed companies affects economic growth positively in the short and long run. Also, stocks market turnover ratio positively impacts economic growth while stock market total value positively affects GDP in the short run. The result of the Toda Yamamoto causality revealed one-way causality from Stocks market turnover ratio to economic growth and from Stock market total value traded to economic growth. The variance decomposition revealed the strength of causality among the variables for a relatively longer period. Based on these findings, recommendations were put forward.

Download or read book Stock Markets Banks and Growth written by Thorsten Beck and published by . This book was released on 2004 with total page 24 pages. Available in PDF, EPUB and Kindle. Book excerpt: Analysis of a panel data set for 1976-1998 shows that on balance stock markets and banks positively influence economic growth - findings that do not result from biases induced by simultaneity, omitted variables, or unobserved country-specific effects.Beck and Levine investigate the impact of stock markets and banks on economic growth using a panel data set for 1976-1998 and applying recent generalized method of moments (GMM) techniques developed for dynamic panels. The authors illustrate econometrically the differences that emerge from different panel procedures. On balance, stock markets and banks positively influence economic growth - and these findings are not a result of biases induced by simultaneity, omitted variables, or unobserved country-specific effects.This paper - a product of Finance, Development Research Group - is part of a larger effort in the group to understand the links between the financial system and economic growth. The authors may be contacted at [email protected] or [email protected].

Download or read book Financial Deepening in Economic Development written by Edward S. Shaw and published by Oxford University Press, USA. This book was released on 1973-01-01 with total page 260 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Stock market and Economic Development written by Ajit Singh and published by . This book was released on 1992 with total page 62 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Testing of Linear and Nonlinear Granger Causality in the Stock Price Volume Relation written by Paramsothy Silvapulle and published by . This book was released on 1997 with total page 48 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Economic Growth and Financial Development written by Muhammad Shahbaz and published by Springer Nature. This book was released on 2021-09-21 with total page 245 pages. Available in PDF, EPUB and Kindle. Book excerpt: This book looks into the relationship between financial development, economic growth, and the possibility of a potential capital flight in the transmission process. It also examines the important role that financial institutions, financial markets, and country-level institutional factors play in economic growth and their impact on capital flight in emerging economies. By presenting new theoretical insights and empirical country studies as well as econometric approaches, the authors focus on the relationship between financial development and economic growth with capital flight in the era of financial crisis. Therefore, this book is a must-read for researchers, scholars, and policy-makers, interested in a better understanding of economic growth and financial development of emerging economies alike.