The impact of financial development on economic growth in the Thailand, Malaysia, and Philippines  

Oleh:

Wongpiyabovorn, Oranuch

Jenis: Article from Proceeding
Dalam koleksi: SIBR-Thammasat 2014 Conference on Interdisciplinary Business & Economics Research June 5th- 7th, 2014 di Emerald Hotel Bangkok, page 1-8.
Topik: Causality test; Economic growth; Financial development; VECM
Fulltext: b14-004.pdf (146.47KB)

Isi artikel

This study investigates the causality between financial development and economic growth in Thailand, Malaysia, and Philippines during 1974-2011. The development in financial sector covers the development in banking system, equity, and bond markets. Vector Error Correction Model is adopted to find the short- and long-run relationships between financial development and economic growth. The empirical results found one long-run relationship between finance and growth for each country. Thai and Malaysian bond markets are negatively related to their own growth in the long-run, whereas financial intermediaries and equity market are positively correlated with per person GDP. However, there is a negative long-run correlation between Philippine stock market and per capita GDP but banking system and bond market are positively related to growth. In Thailand, economic development has effects on banking system in the short-term, and on equity and bond markets in the long-run. In turn, the development in financial intermediaries has a short-run effect on growth. In Malaysia and Philippines, there is no significant impact of financial development on growth. Nonetheless, economic development causes Malaysia’s banking sector in both short- and long-term and also affects stock market in the long-run. Meanwhile, economic development has a long-run impact on Philippine banking sector.

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