The Effects of Financial Innovation on Financial Savings: Evidence From an Economy in Transition

Ansong, Abraham; Marfo-Yiadom, Edward; Ekow-Asmah, Emmanuel

doi:10.1080/15228916.2011.555271

Cited by 31 publications

(32 citation statements)

References 19 publications

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“…They argued that innovative financial products negatively influenced saving propensity in Ghana, encouraging the withdrawal of savings from banks and thus creating a problem of bank liquidity. Similarly, Ansong et al (2011) argued that excessive financial innovation adversely affected banks with diversified financial products.…”

Section: Literature Reviewmentioning

confidence: 99%

Nexus between financial innovation and economic growth in South Asia: evidence from ARDL and nonlinear ARDL approaches

Qamruzzaman

Jiang

2018

Financ Innov

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This study examined the relationship between financial innovation and economic growth in Bangladesh, India, Pakistan, and Sri Lanka for the period Q1 1975 to Q4 2016. The autoregressive distributed lag (ARDL) bounds test was used to gauge long-run relationships, and the nonlinear ARDL (NARDL) test was used to explore asymmetry between financial innovation and economic growth in the sample of Asian countries. The findings from the bounds tests revealed long-run cointegration between financial innovation and economic growth in the sample countries. Furthermore, NARDL confirmed that positive changes in financial innovation linked positively with economic growth and vice versa in the long run. In the short run, however, the study found mixed behaviors in the case of positive and negative changes in financial innovation. To investigate directional causality, the Granger causality test under an error correction model was employed. The Granger causality results supported the feedback hypothesis in both the long run and short run. Thus, financial innovation boosts economic growth in the long run by stimulating financial service expansion, financial efficiency, capital accumulation, and efficient financial intermediation, which are essential for sustainable economic growth.

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Section: Literature Reviewmentioning

confidence: 99%

Nexus between financial innovation and economic growth in South Asia: evidence from ARDL and nonlinear ARDL approaches

Qamruzzaman

Jiang

2018

Financ Innov

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“…A well-functioning capital market and banking sector contribute to economic development (Ndako 2010;Handa and Khan (2008)) through capital formation, the efficient allocation of resources, and by establishing a bridge between surplus units and deficit units. In the opinion of Wadud (2009), Adusei (2013, and Cavenaile et al (2011), well-developed banks and the capital market both play a significant role in sustainable equitable development by allowing productive investment (Mhadhbi 2014;Orji et al 2015;Ilhan, 2008;Ansong et al 2011;Bakang 2016). These, in turn, accelerate economic growth (Ang 2008;Duasa 2014), but the impact of financial development is subject to economic conditions (Adusei 2013).…”

Section: Empirical Literature Reviewmentioning

confidence: 99%

“…Growth economic theory predicts that capital adequacy will positively influence economic growth, and so we assigned this variable a positive sign for its coefficient. Using the approach found in Bakang (2016), the second proxy for financial innovation was defined as the Broad-to-Narrow Money (M2/M1) (Laeven et al 2015;Bara and Mudxingiri 2016;Bara et al 2016;Ansong et al 2011). The other macroeconomic variables we used were the Gross Capital Formation (GCF) and Trade Openness (TO), which were both expected to have a positive coefficient, implying a positive impact on economic growth.…”

Section: Variable and Sourcesmentioning

confidence: 99%

Financial innovation and economic growth in Bangladesh

Qamruzzaman

Jiang

2017

Financ Innov

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“…In addition, given that financial innovation affects the nature and composition of monetary aggregates, the ratio of M2 to M1 is used to capture the effects of financial innovation. A number of studies use M2/M1 as a proxy of financial innovation (see for instance (Hye 2009;Ansong et al 2011)). This study applies the ordinary least square (OLS) estimation technique and Eviews version 8.0 statistical package software.…”

Section: Data and Estimation Proceduresmentioning

confidence: 99%

Private Sector Credit and Inflation Volatility

Katusiime¹

2018

Economies

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This paper investigates the effect of inflation volatility on private sector credit growth. The results indicate that private sector credit growth is positively linked to the one period lagged inflation volatility. Given that past monetary policy actions continue to affect the targeted variables due to the substantial lags in the transmission mechanism, the positive response of private sector credit growth to past inflation volatility suggests a credible monetary policy regime in Uganda, which has led to a reduction in the level of macroeconomic uncertainty and the restoration of favorable economic conditions and prospects, thus increasing the demand for credit. Further, the study finds that the lagged private sector credit growth, nominal exchange rate, and inflation have a statistically significant effect on private sector credit growth while financial innovation, interest rates, and GDP growth appear not to be important determinants of private sector credit growth. The robustness of our findings is confirmed by sensitivity checks.

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The Effects of Financial Innovation on Financial Savings: Evidence From an Economy in Transition

Cited by 31 publications

References 19 publications

Nexus between financial innovation and economic growth in South Asia: evidence from ARDL and nonlinear ARDL approaches

Nexus between financial innovation and economic growth in South Asia: evidence from ARDL and nonlinear ARDL approaches

Financial innovation and economic growth in Bangladesh

Private Sector Credit and Inflation Volatility

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