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Does Finance Lead to Economic Growth? An Empirical Assessment of 12 Asian Economies

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  • Joydeep Biswas

    (Joydeep Biswas is the Assistant Controller of Examinations, Examinations Branch, University of North Bengal, P.O. North Bengal University, Raja Rammohunpur, Dt. Darjeeling 734013, West Bengal; e-mail: yojpeed@yahoo.co.in)

Abstract

The paper describes tests of hypotheses from economic history concerning the significance of financial development as a determinant of economic growth. By invoking co-integration and causality tests for 12 representative countries that corroborate our analysis, evidence shows that the finance and growth relationship varies across Asian markets. Therefore, this study concludes that policy measures for infrastructure improvements should be taken into account to make financial sectors more vibrant to invigorate economic growth.

Suggested Citation

  • Joydeep Biswas, 2008. "Does Finance Lead to Economic Growth? An Empirical Assessment of 12 Asian Economies," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 2(3), pages 229-246, August.
    • Handle: RePEc:sae:mareco:v:2:y:2008:i:3:p:229-246
    DOI: 10.1177/097380100800200301
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    References listed on IDEAS

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    More about this item

    Keywords

    Causality; Economic Growth; Financial Sector Development; JEL Classification: C12; JEL Classification: C32; JEL Classification: G00; JEL Classification: O16;
    All these keywords.

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • G00 - Financial Economics - - General - - - General
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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