Theoretical and Applied Economics
No. 3 / 2016 (608), Autumn
Growth-finance nexus: Empirical evidence from India
Department of Economics, Jamia Millia Islamia, New Delhi, India
Shahid ASHRAF
Department of Economics, Jamia Millia Islamia, New Delhi, India
Umer J. BANDAY
Department of Economics, Jamia Millia Islamia, New Delhi, India
Abstract. The relationship between financial development and economic growth has attracted considerable attention of policymakers and researchers alike. The present study aims to empirically examine the relationship between economic growth and financial development in the post-reform period, from 1992-1993 to 2014-2015. The period witnessed reforms towards financial liberalisation like deregulation of interest rates, lowering reserve requirements, removal of financial markets imperfections and the development of an efficient and sound financial sector. The indicators of financial development used in the study are Broad money to GDP ratio, Stock market capitalization to GDP ratio and Traded Value ratio. The study employs Johnson co-integration technique and finds long run relationship among the variables. Multivariate Granger causality test finds market capitalization and traded value ratio together granger cause GDP, and market capitalization and broad money together granger cause GDP. Also, the study finds causality running from GDP and traded value ratio to market capitalization. The results, therefore, indicate considerable interdependence among economic growth and financial development in the post reform period under study.
Contents
RASDAQ: The final curtain
The relationship between public expenditure and economic growth in Romania: Does it obey Wagner’s or Keynes’s Law?
Cracks in BRICs: A sectoral financial balances analysis and implications for macroeconomic policy
An empirical study of factors influencing total unemployment rate in comparison to youth unemployment rate in selected EU member-states
Is real depreciation expansionary? The case of the Czech Republic
Determinants of sovereign bond yields in emerging economies: Some panel inferences
Investment funds and portfolio of loan guarantees as financial steps proposals to support innovative Small and Medium Enterprises
Dynamic relationship among foreign direct investments, human capital, economic freedom and economic growth: Evidence from panel cointegration and panel causality analysis
Integrating the issue of infrastructural investment with economic growth: The case of India
Globalization of the corruption phenomenon – human capital gone wild
Productivity spillovers from FDI in Turkey: Evidence from quantile regressions
Predicting probability of default of Indian companies: A market based approach
Which country after Greece? Sustainability of budget deficits in selected EU countries: A panel cointegration analysis with multiple structural breaks under cross-section dependence
Statistical-econometric model used to analyze the operational and insolvency risks
Short and long term analysis of some factors effecting youth unemployment in Turkey
Determining the causal relationships among entrepreneurship, educational attainment and per capita GDP in high-income OECD countries
Assessment of the bankruptcy risk based on the solvency ratio
Using simulation and modeling to improve career management processes in organizations
Commodity market integration and price transmission: Empirical evidence from India
Testing the relationship between military spending and private investments: Evidence from Turkey
Growth-finance nexus: Empirical evidence from India
The importance and role of small and medium-sized businesses
Skill biased technological changes: Case of the MENA Region
Net earnings trends in the EU countries
Communication and PR in crisis situations