Financial sector development and economic growth nexus in South Africa
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Date
2012
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Inderscience Enterprises Ltd
Abstract
The study investigated the nexus between financial sector
development and economic growth in South Africa using cointegration and
error correction modelling and; the Granger causality tests. The results of the
study show that economic growth is explained by the financial sector variables
and control variables such as inflation, exchange rate, and real interest rates.
The Granger causality test results show that there is generally a bidirectional
relationship between economic growth and financial sector development which
implies that if the economy grows the financial services sector also grows and
vice versa.
Description
Keywords
growth; financial development; economic growth; financial sector development; monetary economics; finance; unit root tests; cointegration; error correction; Granger causality; bidirectional; South Africa.
Citation
Sunde, T. (2012). Financial sector development and economic growth nexus in South Africa. International Journal of Monetary Economics and Finance, 5(1), 64-75.