Stock markets, banks, and economic growth: Evidence from more homogeneous panels

Fufa, Tolina; Kim, Jaebeom

doi:10.1016/j.ribaf.2017.07.120

Cited by 48 publications

(47 citation statements)

References 38 publications

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“…Latif et al [37] discovered that ICT, FDI and international trade contribute positively to economic growth. Like the conclusion of Fufa and Kim [23] on the role of finance on growth, Niebel [44] reveals that ICT contributes significantly to growth in developed countries than in developing countries. More recently, Pradhan et al [53] found that ICT infrastructure enhances economic growth where a unidirectional causality runs from ICT infrastructure to economic growth.…”

Section: Empirical Literature Reviewmentioning

confidence: 72%

“…The result of the Hansen threshold technique from Ibrahim and Alagidede [29] reveals that financial development accelerates economic growth, but below 11% threshold level, finance is largely unresponsive to growth. Ruiz-Vergara [64] with a dynamic panel threshold estimator and Fufa and Kim [23] with GMM technique show that the impact of finance on growth is higher in industrialized countries compared with developing countries.…”

Section: Empirical Literature Reviewmentioning

confidence: 99%

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ICT diffusion and the finance–growth nexus: a panel analysis on ECOWAS countries

Alimi

Adediran

2020

Futur Bus J

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In this study, we rely on the extension of the endogenous growth theory to consider the role of ICT diffusion in the finance-growth nexus theoretically informed via the supply-leading and demand-following theses. Motivated by current realities highlighting the significance of information and communication technologies (ICTs) to modern societies, the study evaluates the foregoing research objective in ECOWAS countries over the 2005-2016 period based on the justification of the ICT diffusion into the ECOWAS region around the early 2000s. Innovatively, the study constructs an ICT diffusion index covering fixed telephone lines, mobile cellular subscription and Internet penetration as relevant media for ICT dispersion. We adopt the pooled mean group estimator on a dynamic panel ARDL model for robust analysis of the subject matter. We find that financial development (its main and alternative measure) alone inhibits growth of ECOWAS countries, but its interaction with ICT diffusion promotes economic growth in the region. The implication of our research findings for the West African region is that financial sector development efforts have to be strengthened by investment in ICT infrastructure, improved Internet penetration and further integration of electronic finance policies.

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Section: Empirical Literature Reviewmentioning

confidence: 72%

Section: Empirical Literature Reviewmentioning

confidence: 99%

ICT diffusion and the finance–growth nexus: a panel analysis on ECOWAS countries

Alimi

Adediran

2020

Futur Bus J

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“…Studies exist employing these methods in similar contexts (Lensink, Mersland, Vu and Zamore, 2018;Tebaldi, Nguyen and Zuluaga, 2018;Fufa and Kim, 2018). While many studies have used fixed effects and random effects model for panel data (for example, Glass, Cook and Ingersoll, 2016;Atan et al 2018), Athanasoglou, Brissimis, and Delis (2008) stated that perseverance of bank performance over the time might disturb the following year's return.…”

Section: Generalized Methods Of Moments (Gmm)mentioning

confidence: 99%

Do environmental, social and governance performance affect the financial performance of banks? A cross-country study of emerging market banks

Shakil

Mahmood

Tasnia

et al. 2019

MEQ

189

117

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Purpose Earlier firms were evaluated mostly from their financial performance perspective, but with the increasing attention to sustainability goals, environmental, social and governance (ESG) performance of firms became key concerns to stakeholders. The purpose of this paper is to explore the effects of ESG performance of banks on their financial performance, in the context of emerging markets. Design/methodology/approach This study employs the generalised method of moments technique for estimation purpose due to the dynamic nature of the data and to correct for endogeneity. This study uses the ESG performance data of 93 emerging market banks from 2015 to 2018, available in Asset4 ESG database of Refinitiv, formerly known as Thompson Reuters. The accounting and financial data are collected from Refinitiv Datastream database. Findings The findings indicate a positive association of emerging market banks’ environmental and social performance with their financial performance, but governance performance does not influence financial performance. Originality/value While many studies exist on the association of ESG concerns of an organisation with their financial profitability, the literature on in the context of banking is still limited. To the best of the authors’ knowledge, this is the first study that examines the effect of ESG practices of banks on their financial performance in the context of emerging economies.

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“…Additional research potential lies in investigating how the relationships between stock prices and macroeconomic variables differ across developed and emerging economies, given that the latter may behave somewhat distinctly from the former (Camilleri & Galea, 2009;Fufa and Kim, 2018). Further insights may also be gleaned by the inclusion of additional macroeconomic indicators such as capital flows (Liew et al, 2018), economic productivity (Camilleri & Falzon, 2013) and equity market openness (Ngoc Tran, 2017).…”

Section: Irxmsmentioning

confidence: 99%

Do stock markets lead or lag macroeconomic variables? Evidence from select European countries

Camilleri

Scicluna

Bai

2019

The North American Journal of Economics and Finance

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This study examines the connections between stock prices and key macroeconomic indicators: inflation, industrial production, interest rates, money supply and select interactions between the latter group of variables. Such links are evaluated through vectorautoregressions (VARs) on monthly data spanning over the period 1999-2017, for Belgium, France, Germany, Netherlands and Portugal. We check whether such relations are confirmed across different sub-periods and also adopt a non-parametric approach by using a Pesaran-Timmermann test. We find different contemporaneous and lead-lag relationships between stock prices and the selected variables, although there are variations across countries. VAR models indicate that stock prices significantly lead inflation across all countries during the sample period and in most cases this relationship was positive. In addition, stock prices significantly lead industrial production in four of the sampled countries and these relationships were positive as well. Contrary to long-established finance theories, we did not find numerous significant links between interest rates and stock indices; however the interaction between interest rates and money supply was a leading indicator of stock prices in France, Germany and Portugal.

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Stock markets, banks, and economic growth: Evidence from more homogeneous panels

Cited by 48 publications

References 38 publications

ICT diffusion and the finance–growth nexus: a panel analysis on ECOWAS countries

ICT diffusion and the finance–growth nexus: a panel analysis on ECOWAS countries

Do environmental, social and governance performance affect the financial performance of banks? A cross-country study of emerging market banks

Do stock markets lead or lag macroeconomic variables? Evidence from select European countries

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