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A Dynamic Causal Linkage between Financial Development, Trade Openness and Economic Growth: Evidence from Malawi.
| Content Provider | Semantic Scholar |
|---|---|
| Author | Kenani, James Manuel Fujio, Minako |
| Copyright Year | 2012 |
| Abstract | This paper investigates the dynamic causal relationship between financial development, trade openness and economic growth in Malawi in trivariate (VAR) model. The study also explores a possible indirect causal effect which finance may have on growth through trade openness. Three alternative measures of financial development: money supply, liquid liabilities, and private sector credit are employed to determine the impact of different aspects of financial development on economic growth. The Johansen Cointegration tests results indicate a long-run positive relationship between financial development, trade openness and economic growth. The Granger causality test results based on VECM shows that financial development has a unilateral causal effect on economic growth in the short-run; while financial development and trade openness have a short-run bidirectional relationship depending on financial development measure. However, the findings indicate that the indirect causal effect that financial development has on economic growth through trade openness depends on financial development measure. |
| File Format | PDF HTM / HTML |
| Alternate Webpage(s) | https://journal-archieves23.webs.com/569-583.pdf |
| Language | English |
| Access Restriction | Open |
| Content Type | Text |
| Resource Type | Article |
