IDEAS home Printed from https://ideas.repec.org/a/bpj/cferev/v13y2024i1p88-111n5.html
   My bibliography  Save this article

Stock Markets, Financial Depth, and Economic Growth in China: Evidence from ARDL Model

Author

Listed:
  • Bouattour Afef

    (Economics, Higher Institute of Business Administration of Sfax, University of Sfax, Sfax, Tunisia)

  • Kalai Maha
  • Helali Kamel

    (Quantitative Methods, Faculty of Economics and Management of Sfax, University of Sfax, Sfax, Tunisia)

Abstract

The relationship between financial development and economic growth in China is controversial. From this perspective, this article aims to identify this relationship using both capital market and banking intermediation indicators, which were rarely considered in the previous literature. An autoregressive model with staggered lags (ARDL) examines the long-run cointegration relationship between 1980 and 2020. The results suggest that the contribution of different subsectors of the Chinese financial system to economic growth differs. The development of the money market has a negative impact, whereas market capitalization has a positive impact on economic growth in China. Regarding the contribution of the banking system to China’s economic growth, the two variables measuring the depth of financial institutions showed opposite impacts in both the short and long term. Regarding important policy implications, regulators need to ensure a pro-growth environment, effectively regulate the informal banking system, and prevent potential financial risks by revising policies.

Suggested Citation

  • Bouattour Afef & Kalai Maha & Helali Kamel, 2024. "Stock Markets, Financial Depth, and Economic Growth in China: Evidence from ARDL Model," China Finance and Economic Review, De Gruyter, vol. 13(1), pages 88-111, March.
    • Handle: RePEc:bpj:cferev:v:13:y:2024:i:1:p:88-111:n:5
    DOI: 10.1515/cfer-2024-0005
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/cfer-2024-0005
    Download Restriction: no
    File URL: https://libkey.io/10.1515/cfer-2024-0005?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:cferev:v:13:y:2024:i:1:p:88-111:n:5. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.