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The Impact of Stock Market Development on Inflation and Economic Growth of 16 Asian Countries: A Panel VAR Approach

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  • Rudra P. PRADHAN
  • Mak B. ARVIN
  • Bele SAMADHAN
  • Shilpa TANEJA

Abstract

Empirical macroeconomists have investigated the possible link between the development of stock markets, economic growth, and inflation separately. Unlike earlier work, this paper investigates the nature of causal relations between these variables using a panel Granger causality test on a sample of 16 Asian countries over 1988-2012. Employing a panel vector autoregressive (VAR) model, our results also reveal that these variables are cointegrated, suggesting presence of a long-run equilibrium relationship among them.

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Bibliographic Info

Article provided by Euro-American Association of Economic Development in its journal Applied Econometrics and International Development.

Volume (Year): 13 (2013)
Issue (Month): 1 ()
Pages: 203-218

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Handle: RePEc:eaa:aeinde:v:13:y:2013:i:1_16

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Keywords: stock market developments; inflation; economic growth; panel VAR.;

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