The Effect of Financial Development on Economic Growth Countries ASEAN-4
Downloads
This study aims to determine the effect of financial development on economic growth in ASEAN-4 during 1999-2018. This study uses the regression method and panel approaches using the Fixed Effect Model method. This research uses the FEM quantitative method and uses a stata 13 estimation tool. The panel data regression results in this study indicated that financial development has a positive relationship with economic growth. This is evident from the three financial development proxies, which have a positive correlation with economic growth domestic credit to private sector, money broad variables, market capitalization and degree of openness to reflect the real sector.
Keywords: Financial Development, Degree of Openness, Economic Growth
JEL : G2, O11, O16
Ajogbeje, K. (2016). Finance – Growth Nexus in Nigeria: Fragility and Development Effects. European Scientific Journal, ESJ, 12(7), 381.
Ang, J., & McKibbin, W. (2007). Financial liberalization, financial sector development and growth: Evidence from Malaysia. Journal of Development Economics, 84(1), 215–233.
Ansong, A., & Gyensare, M. A. (2012). Determinants of University Working-Students' Financial Literacy at the University of Cape Coast, Ghana. International Journal of Business and Management, 7(9). https://doi.org/10.5539/ijbm.v7n9p126
Asteriou, D., & Spanos, K. (2019). The relationship between financial development and economic growth during the recent crisis: Evidence from the EU. Finance Research Letters, 28(C), 238–245.
Beck, T., & Demirguc-Kunt, A. (2006). Small and medium-size enterprises: Access to finance as a growth constraint. Journal of Banking & Finance, 30(11), 2931–2943.
Beck, T., Levine, R., & Loayza, N. (2000). Finance and the sources of growth. Journal of Financial Economics, 58(1–2), 261–300.
Botev, J., í‰gert, B., & Jawadi, F. (2019). The nonlinear relationship between economic growth and financial development: Evidence from developing, emerging and advanced economies. International Economics, 160(December 2017), 3–13. https://doi.org/10.1016/j.inteco.2019.06.004
Bujari, A., Calafate, C. T., Cano, J. C., Manzoni, P., Palazzi, C. E., & Ronzani, D. (2017). Flying ad-hoc network application scenarios and mobility models. International Journal of Distributed Sensor Networks, 13(10), 1–17. https://doi.org/10.1177/1550147717738192
Chaitip, P., Chokethaworn, K., Chaiboonsri, C., & Khounkhalax, M. (2015). Money Supply Influencing on Economic Growth-wide Phenomena of AEC Open Region. Procedia Economics and Finance, 24, 108–115.
Demirgüç-Kunt, A. (2006). Finance and Economic Development: Policy Choices for Developing Countries. World Bank Policy Research Working Paper, 3955(2006), 54. http://books.google.com/books?id=4o_v5jLH4KUC&pgis=1
Demirgüç-Kunt, A., Beck, T., & Honohan, P. (2008). Finance for all? Policies and Pitfalls in Expanding access. In World Bank Policy Research Report (Issue August).
Ductor, L., & Grechyna, D. (2015). Financial development, real sector, and economic growth. International Review of Economics & Finance, 37(C), 393–405.
Durusu-Ciftci, D., Ispir, M. S., & Yetkiner, H. (2017). Financial development and economic growth: Some theory and more evidence. Journal of Policy Modeling, 39(2), 290–306. https://doi.org/10.1016/j.jpolmod.2016.08.001
Fetahi-Vehapi, M., Sadiku, L., & Petkovski, M. (2015). Empirical Analysis of the Effects of Trade Openness on Economic Growth: An Evidence for South East European Countries. Procedia Economics and Finance, 19, 17–26.
Hussain, M., & Haque, M. (2017). Empirical Analysis of the Relationship between Money Supply and Per Capita GDP Growth Rate in Bangladesh. Journal of Advances in Economics and Finance., 2.
Ibrahim, M., & Alagidede, P. (2018). Nonlinearities in financial development–economic growth nexus: Evidence from sub-Saharan Africa. Research in International Business and Finance, 46(C), 95–104.
Jayaratne, J., & Strahan, P. E. (1996). The Finance-Growth Nexus: Evidence from Bank Branch Deregulation. The Quarterly Journal of Economics, 111(3), 639–670.
Keho, Y. (2017). The impact of trade openness on economic growth: The case of Cote d'Ivoire. Cogent Economics & Finance, 5(1), 1332820.
Kindleberger, C. P. (1963). Economic Backwardness in Historical Perspective: A Book of Essays. By Alexander Gerschenkron. Cambridge: The Belknap Press of Harvard University Press, 1962. Pp. 456. $8.75. The Journal of Economic History, 23(3), 360–362.
King, R. G., & Levine, R. (1993). Finance and Growth: Schumpeter Might Be Right. The Quarterly Journal of Economics, 108(3), 717–737.
Kong, Q., Peng, D., Ni, Y., Jiang, X., & Wang, Z. (2021). Trade openness and economic growth quality of China: Empirical analysis using ARDL model. Finance Research Letters, 38, 101488.
Lee, J. (2005). Financial Intermediation and Economic Growth Evidence from Canada. Eastern Economics Association, New York.
Levine, R. (1997). Financial Development and Economic Growth: Views and Agenda. Journal of Economic Literature, 35(2), 688–726.
Levine, R., & Zervos, S. (1998). Stock Markets, Banks, and Economic Growth. American Economic Review, 88(3), 537–558.
Lucas, R. E. (1988). On the mechanics of economic development. Journal of Monetary Economics, 22(1), 3–42.
Mankiw, N. G. (2006). Macroeconomics (6th edition). New York: Worth Publishers.
Musila, J., & Yiheyis, Z. (2015). The Impact of Trade Openness on Growth: the Case of Kenya. Journal of Policy Modeling, 37(2).
Odhiambo, N. M. (2008). Financial depth, savings and economic growth in Kenya: A dynamic causal linkage. Economic Modelling, 25(4), 704–713.
Omodero, C. O. (2019). Effect of Money Supply on Economic Growth: A Comparative Study of Nigeria and Ghana. International Journal of Social Science Studies, 7(3), 16.
Ono, S. (2017). Financial development and economic growth nexus in Russia. Russian Journal of Economics, 3(3), 321–332.
Pradhan, R. P., Arvin, M. B., Hall, J. H., & Nair, M. (2016). Innovation, financial development and economic growth in Eurozone countries. Applied Economics Letters, 23(16), 1141–1144.
Prochniak, M., & Wasiak, K. (2017). The impact of the financial system on economic growth in the context of the global crisis: empirical evidence for the EU and OECD countries. Empirica, 44(2), 295–337.
Purwono, R., Yasin, M. Z., & Khoerul Mubin, M. (2021). Correction to: Explaining regional inflation programmes in Indonesia: Does inflation rate converge? (Economic Change and Restructuring, (2020), 53, 4, (571-590), 10.1007/s10644-020-09264-x). Economic Change and Restructuring, 4. https://doi.org/10.1007/s10644-021-09343-7
Rahman, M. M., & Mamun, S. A. K. (2016). Energy use, international trade and economic growth nexus in Australia: New evidence from an extended growth model. Renewable and Sustainable Energy Reviews, 64, 806–816.
Salvatore. (1997). Ekonomi Internasional, Edisi Kelima (diterjemahkan oleh Haris Munandar). Jakarta: Erlangga
Scheineder, Patricia Higino. (2005). International Trade, Economic Growth and Intellectual Property Rights: A Panel Data Study of Developed and Developing Countries. Journal of Development Economics, 78, 529-547.
Seven, Ü., & Yetkiner, H. (2016). Fin-ancial intermediation and economic growth: Does income matter? Economic Systems, 40(1).
Shahbaz, M., Rehman, I. U., & Muzaffar, A. T. (2015). Re-Visiting Financial Development and Economic Growth Nexus: The Role of Capitalization in Bangladesh. South African Journal of Economics, 83(3), 452–471.
Sipatuhar, M. A. (2016). Keterkaitan Kredit dan Kelembagaan Perbankan Indonesia pada Perekonomian Nasional dan Regional (Linkage of Indonesian bankCredit and Institutional on National and Regional Economy) Sekolah Pascasarjana Institut Pertanian Bogor, Indonesia
Vergara, R. J. (2018). Financial development, institutional investors, and economic growth. International Review of Economics and Finance, 54(August 2017), 218–224. https://doi.org/10.1016/j.iref.2017.08.009
Copyright (c) 2021 Wisnu Wibowo
This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.
JIET (Jurnal Ilmu Ekonomi Terapan) (p-ISSN: 2541-1470; e-ISSN: 2528-1879) is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License
Authors who publish with JIET (Jurnal Ilmu Ekonomi Terapan) agree to the following terms:
- The journal allows the author to hold the copyright of the article without restrictions.
- The journal allows the author(s) to retain publishing rights without restrictions
- The legal formal aspect of journal publication accessibility refers to Creative Commons Attribution ShareAlike 4.0 International License (CC BY-SA).
