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Direction of Causality Between Financial Development and Economic Growth. Evidence for Developing Countries

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  • Borlea Sorin Nicolae
  • Puscas Adriana

    („Vasile Goldis“ Western University of Arad)

  • Mare Codruta
  • Achim Monica Violeta

    (Babes-Bolyai University of Cluj-Napoca)

Abstract

The results of extensive studies that analyzed the existence and meaning of correlations between the economic growth and the financial market development lead us to a more thorough study of these correlations. Therefore, we performed a broad study of the developing countries from around the world (the developing part of each region constructed by the World Bank through its Statistics Bureau). The regions taken into analysis were: Europe and Central Asia, South Asia, East Asia and the Pacific, the Arab world, Latin America & and the Caribbean, the Middle East and North Africa, and Sub-Saharan Africa. For comparison purposes, we have also included in the sample the North American countries, the Euro Area and the European Union as a whole, because these last three areas are the main benchmarks of the financial markets. The results are consistent with those from previous studies on the subject and vary depending on region and financial indicator considered.

Suggested Citation

  • Borlea Sorin Nicolae & Puscas Adriana & Mare Codruta & Achim Monica Violeta, 2016. "Direction of Causality Between Financial Development and Economic Growth. Evidence for Developing Countries," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 26(2), pages 1-22, June.
    • Handle: RePEc:vrs:suvges:v:26:y:2016:i:2:p:1-22:n:1
    DOI: 10.1515/sues-2016-0006
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    Cited by:

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    2. Nageri Kamaldeen Ibraheem, 2020. "Ease of Doing Business and Capital Market Development in a Demand Following Hypothesis: Evidence from ECOWAS," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 30(4), pages 24-54, December.
    3. Erika Loučanová & Ján Parobek & Martina Nosáľová & Dopico Ana & Daniela Hupková, 2020. "Perception of Intelligent Packaging in the Context of Bioeconomy," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 30(3), pages 77-89, September.
    4. Loucanova Erika & Kalamarova Martina & Parobek Jan, 2017. "The Innovative Approaches to Packaging – Comparison Analysis of Intelligent and Active Packaging Perceptions in Slovakia," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 27(2), pages 33-44, June.
    5. Driouchi, Ahmed & Harkat, Tahar, 2017. "Granger Causality and the Factors underlying the Role of Younger Generations in Economic, Social and Political Changes in Arab Countries," MPRA Paper 77218, University Library of Munich, Germany.

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