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Finance-Growth Nexus in Africa: A Panel Generalized Method of Moments (GMM) Analysis

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  • Michael Adusei

    (Kwame Nkrumah University of Science and Technology, Kumasi-Ghana)

Abstract

The paper uses the dynamic GMM Model to examine the finance-growth nexus with panel data (1981-2010) from 24 African countries. Evidence suggests that there is a positive relationship between finance and economic growth and that there is a bi-directional causal relationship between finance and economic growth. To the extent that financial development and economic growth Granger-cause each other, we assert that policies directed at any of the two , if efficiently and vigorously pursued, could be beneficial to the study countries.

Suggested Citation

  • Michael Adusei, 2013. "Finance-Growth Nexus in Africa: A Panel Generalized Method of Moments (GMM) Analysis," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 3(10), pages 1314-1324, October.
  • Handle: RePEc:asi:aeafrj:2013:p:1314-1324
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    References listed on IDEAS

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    Keywords

    Africa; financial development; economic growth;

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