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Stock market development, human capital, and economic growth in Sub-Saharan Africa

Author

Listed:
  • John Kagochi
  • Nazif Durmaz

    (University of Houston-Victoria)

Abstract

The study examines the relationship between stock market development, human capital development, and economic growth for nine Sub-Saharan Africa using a dynamic panel (system GMM) data model technique. The study employs stock market and banking sector development as measures of financial sector development. We also use the Human Capital Index based on the average years of schooling and an assumed rate of return to education. Our findings indicate that human capital leads to economic growth while stock market development does not influence economic growth, perhaps due to the relative underdevelopment of these markets or economic stagnation of the region.

Suggested Citation

  • John Kagochi & Nazif Durmaz, 2020. "Stock market development, human capital, and economic growth in Sub-Saharan Africa," Review of Development Finance Journal, Chartered Institute of Development Finance, vol. 10(1), pages 17-30.
    • Handle: RePEc:afj:journ3:v:10:y:2020:i:1:p:17-30
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    File URL: https://journals.co.za/content/rdfin/10/1/ejc-rdfin-v10-n1-a2
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    More about this item

    Keywords

    Stock market; human capital; sub Saharan Africa; economic growth; GMM model;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • F63 - International Economics - - Economic Impacts of Globalization - - - Economic Development

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