Original Research
Financial development and economic growth: literature survey and empirical evidence from sub-Saharan African countries
Submitted: 11 August 2011 | Published: 12 August 2011
About the author(s)
Songul Kakilli Acaravci, Mustafa Kemal University, TurkeyIlhan Ozturk, Cag University, Turkey
Ali Acaravci, Mustafa Kemal University, Turkey
Full Text:
PDF (268KB)Abstract
In this paper we review the literature on the finance-growth nexus and investigate the causality between financial development and economic growth in Sub-Saharan Africa for the period 1975-2005. Using panel co-integration and panel GMM estimation for causality, the results of the panel co-integration analysis provide evidence of no long-run relationship between financial development and economic growth. The empirical findings in the paper show a bi-directional causal relationship between the growth of real GDP per capita and the domestic credit provided by the banking sector for the panels of 24 Sub-Saharan African countries. The findings imply that African countries can accelerate their economic growth by improving their financial systems and vice versa.
Keywords
Metrics
Total abstract views: 4584Total article views: 11867
Crossref Citations
1. Financial systems, regulatory quality, and economic growth
Chien-Chiang Lee, Godwin Olasehinde-Williams, Ifedolapo Olanipekun
The Journal of International Trade & Economic Development vol: 30 issue: 2 first page: 246 year: 2021
doi: 10.1080/09638199.2020.1847172