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Sovereign wealth funds and economic growth

Author

Listed:
  • Ermanno Affuso

    (University of South Alabama)

  • Khandokar M. Istiak

    (University of South Alabama)

  • Alex Sharland

    (University of South Alabama)

Abstract

A synthetic control method in a comparative case study evaluates the potential effect of a sovereign wealth fund on the economic growth of a country. Trinidad and Tobago (T&T) is the focus of the case study. This is the first empirical research in the economic literature that attempts to evaluate the impact of a sovereign wealth fund on economic growth of an emerging economy. The results provide evidence that the fund contributed to a higher real per capita GDP of T&T by an estimate of $5104.57 (2010 US$) per year. The cumulative 30 years’ welfare impact of the fund is approximately $107,196 (2010 US$) per capita. Small island economies should consider implementing similar programs to foster economic growth.

Suggested Citation

  • Ermanno Affuso & Khandokar M. Istiak & Alex Sharland, 2022. "Sovereign wealth funds and economic growth," Journal of Asset Management, Palgrave Macmillan, vol. 23(3), pages 201-214, May.
    • Handle: RePEc:pal:assmgt:v:23:y:2022:i:3:d:10.1057_s41260-022-00260-6
    DOI: 10.1057/s41260-022-00260-6
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    References listed on IDEAS

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    More about this item

    Keywords

    Economic development; Sovereign wealth funds; Synthetic control method; Small island developing states; Trinidad and Tobago;
    All these keywords.

    JEL classification:

    • C54 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Quantitative Policy Modeling
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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