The Impact of Banks and Stock Market Development on Economic Growth in South Africa: an ARDL-bounds Testing Approach
Open accessAbstract
This paper examines the impact of both bank-and market-based financial development on economic growth in South Africa during the period from 1980 to 2012.Unlike some previous studies, the current study employs means-removed average to construct both bank-and market-based financial development indices.The study uses the newly developed autoregressive distributed lag (ARDL) bounds testing approach to examine this linkage.The empirical results of this study show that there is a positive relationship between bank-based financial development and economic growth in South Africa.The results, however, fail to find any relationship between market-based financial development and economic growth in South Africa.The results apply irrespective of whether the regression analysis is conducted in the short run or in the long run.These results imply that it is bank-based financial development rather than market-based financial development that plays a pivotal role in propelling South Africa's real sector.
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Sound financial sectors of a country contribute to economic growth significantly.
“Additionally, the present study findings are in line with the previous arguments which are that sound financial sectors of a country contribute to economic growth significantly.”
From The effect of financial development on economic Growth: Evidence from south Asian developing countries (2022) · cites this paper as Nyasha & Odhiambo, 2015
Cites
Savings and economic growth in South Africa: A multivariate causality test
Odhiambo, N. M. (2009) · Journal of Policy Modeling · doi:10.1016/j.jpolmod.2009.04.001 · Cited by 111 · see citing works
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Bibi, R., & Sumaira (2022) · Journal of Environmental Science and Economics · doi:10.56556/jescae.v1i1.1 · Cited by 30 · see citing works
“…study have found by several scholars on the relation of finance and economic growth which reinforce the findings of the present study such as (Nyasha & Odhiambo, 2015), (Alimi, 2015), (Sahoo, 2014), (Adu, Marbuah, & Mensah, 2013), (R. Levine, 2005), Levine and Zervos (1996) and Hassan et…”
BackgroundResult
- Authors
- Nyasha, S., & Odhiambo, N. M.
- Affiliations
- University of South Africa (ZA)
- Venue
- Contemporary Economics
- Published
- 2015-03-31
- Volume
- 9
- Issue
- 1
- Pages
- 93-108
- ISSN
- 1897-9254 (ISSN-L)
- 2084-0845
- OpenAlex
- W209305993
- Cited by
- 94
- References
- 1
- Citations by year
- 2026: 3 · 2025: 4 · 2024: 11 · 2023: 8 · 2022: 9 · 2021: 12 · 2020: 11 · 2019: 10 · 2018: 8 · 2017: 15 · 2016: 1 · 2015: 1 · 2014: 1
- FWCI
- 24.78
- Type
- journal article
- Language
- en
- Open access
- diamond
- doi.org
- Licence
- cc-by
- Locations
- Contemporary Economics (publishedVersion, cc-by)
- RePEc: Research Papers in Economics (submittedVersion)
- SSRN Electronic Journal (submittedVersion)
- DOAJ (DOAJ: Directory of Open Access Journals) (submittedVersion, cc-by-sa)
- Econstor (Econstor) (submittedVersion)
- Topics
- Social Sciences › Economics, Econometrics and Finance › General Economics, Econometrics and Finance › Monetary Policy and Economic Impact
- Social Sciences › Economics, Econometrics and Finance › Finance › Banking stability, regulation, efficiency
- Physical Sciences › Computer Science › Information Systems › Economic Growth and Development
- Keywords
- economic growth, South Africa, banking sector, stock market development, real economy
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