Financial Integration and Economic Growth: Should Asia Emulate Europe?

Selvarajan, Sonia Kumari; Ab-Rahim, Rossazana

doi:10.11130/jei.2020.35.1.191

Cited by 16 publications

(14 citation statements)

References 49 publications

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“…The study further established that financial development plays a pivotal role for integration to have a positive impact on economic growth by utilizing the vector error correction model (VECM), with the real GDP per capita being the proxy of economic growth. The studies by Selvarajan and Ab-Rahim (2020) and Bong and Premaratne (2019) on Asia supported these findings. Ahmed (2010), investigating 15 sub-Saharan African countries in the period 1976-2005, postulated that there exists a long equilibrium between financial development and economic growth.…”

Section: Introductionmentioning

confidence: 59%

Financial Development, Integration, Inclusion, and Economic Growth: Co-Integrating Relationships and Threshold Analysis

Chiwira

2022

EJEF

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This study examines the short and long-run relationships between financial development, integration, inclusion, and economic growth in SADC, as well as the corresponding threshold levels. Covering the period 1995 to 2020, the ARDL technique was used to test for co-integrating relationships, and the GLS was utilized for the determination of the respective threshold levels. The study establishes that bank credit to the private sector negatively affects economic growth in the long run. Most SADC countries were still operating below their respective minimum financial development threshold levels. It is observed that there are no threshold levels for financial integration in SADC, although the result, compared with the threshold levels of financial development seems to suggest that the financial domestic system and some level of economic development are a prerequisite for financial integration decisions. The financial inclusion threshold level for poor SADC countries is low. Yet most of these countries had the highest mobile banking facilities in the region. One possible indication can be that these countries may be operating at financial inclusion levels detrimental to economic growth. Financial development, along with its facets of financial integration and financial inclusion, is found to be the driver of economic growth in SADC. SADC countries, therefore, need to establish a strategic mix of these facets of financial development for the realization of significant economic growth.

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Section: Introductionmentioning

confidence: 59%

Financial Development, Integration, Inclusion, and Economic Growth: Co-Integrating Relationships and Threshold Analysis

Chiwira

2022

EJEF

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“…The flow of information and the quality of information is improved because it allows investors to evaluate investments remotely more carefully and quickly. An increase in market size and an increase in the availability of goods and services can lower the cost of trade, increasing efficiency leading to greater purchasing power and of course increases global economic growt (Yu et al, 2010;Albulescu & Pepin, 2018;Selvarajan & Ab-Rahim, 2020).…”

Section: Introductionmentioning

confidence: 99%

Analyzing the Dynamics of Islamic Stock Market Indices in Several Muslim Countries

Haryono¹,

Atika²

2023

J. Professional Business Review

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Purpose: Analyzing stock price is very necessary to identify the overall price of the stock index, which the market players have various options and references to invest their money in the profitable securities portfolio. Based on the reason, the aim of this study is to examine the Islamic stock price movement in several Muslim countries joined in the Islamic Conference Organization (IOC). Theoretical Framework: This study refers to the theoretical framework that the integrated capital market can help everyone in analyzing the quality and quantity of the Islamic stock price movement, including its challenges and opportunity in the context of investment risk management. Design/Methodology/Approach: This research uses a descriptive-analytical method and comparative approach to examine the tends of Islamic stock price movement in six Muslim countries from the period January 2010 to December 2019, namely JII-Indonesia, DJIMY-Malaysia, DJTR-Turkey, DJIMKW-Kuwait, TDWL-Saudi Arabia, and QEAR-Qatar, which are analyzed quantitatively, statistically, and deductively. Findings: The results of the research show that the co-integrated of Islamic Stock Index are JII-Indonesia with DJIMY-Malaysia, JII-Indonesia and DJIMKW-Kuwait, DJIMY-Malaysia with DJIMKW-Kuwait, DJTR-Turkey with DJIMKW-Kuwait, QEAR-Qatar with DJIMKW-Kuwait. The Islamic stock index pairs confirmed through the VAR and VECM tests are only DJIMY-Malaysia with QEAR-Qatar, DJIMY-Malaysia with DJIMKW-Kuwait, and TDWL-Saudi Arabia with QEAR-Qatar. Research, Practical & Social Implications: This study becomes one example of the practical analysis of Islamic Stock Market movements that can be used to the stock market players in taking the consideration and decision for the investment in capital market. Originality/Value: This result of this study is originally limited in the Islamic stock index in six Muslim countries such as Indonesia, Malaysia, Turkey, Saudi Arabia, Qatar, and Kuwait. However, this can be explored more comprehensively in the same or various research objective by the other researchers.

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“…the prospect of using the results is to adjust macroeconomic policy, monetary and financial instruments, taking into account the sensitivity of target macroeconomic parameters to financial wealth, including the differentiation of policy instruments for each country. Keywords: financial wealth; economic growth rate; gross domestic product; inequality; poverty; human development index; macroeconomic dynamics; comparative analysis of countries О. С. Сухарев, Е. Н. Ворончихина вопросы функционирования финансового сектора в условиях глобализации и интеграции [28,29].…”

Section: Introductionmentioning

confidence: 99%

Financial Wealth in Macroeconomic Dynamics

Sukharev

Voronchikhina

2022

jour

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The article examines the financial wealth that affects macroeconomic dynamics from a comparative perspective for some countries. The purpose of the study is to identify changes in financial wealth and determine their impact on macroeconomic dynamics, taking into account the assessment of the impact of the level of social indicators — inequality and poverty, in particular, on changing the goals of economic development — growth rate, human development index. The methodology consists of empirical, structural, comparative analysis, econometric modeling, which is reduced to the construction of multiple regressions based on the Gretl 2020b software module, multiplicative models by the type of production functions. Taking into account these methods, an analysis algorithm has been developed to assess the impact of financial wealth on macroeconomic dynamics. The implementation of this algorithm made it possible to carry out a comparative analysis of the results for Russia, the G7 countries and China in terms of the influence of financial wealth on their development. The main empirical result is that financial wealth has a stronger effect on economic dynamics and social indicators of development than non-financial wealth, and is associated with the growth rate of highly developed countries. For Russia, the growth of financial wealth, albeit small, was associated with high growth rates, however, the econometric analysis revealed that financial wealth did not have a decisive influence on growth rates, reducing the human development index, unlike other countries, this affected the increase in this index. The authors conclude that the Russian economy showed the lowest sensitivity of GDP to financial wealth, but high to the Gini index, with only China and Russia having a higher sensitivity to non-financial rather than financial wealth compared to other reviewed countries. The prospect of using the results is to adjust macroeconomic policy, monetary and financial instruments, taking into account the sensitivity of target macroeconomic parameters to financial wealth, including the differentiation of policy instruments for each country.

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Financial Integration and Economic Growth: Should Asia Emulate Europe?

Cited by 16 publications

References 49 publications

Financial Development, Integration, Inclusion, and Economic Growth: Co-Integrating Relationships and Threshold Analysis

Financial Development, Integration, Inclusion, and Economic Growth: Co-Integrating Relationships and Threshold Analysis

Analyzing the Dynamics of Islamic Stock Market Indices in Several Muslim Countries

Financial Wealth in Macroeconomic Dynamics

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