An investigation of the relationship between financial development and economic growth in Namibia
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Date
2018
Authors
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Publisher
University of Namibia
Abstract
The study investigates the relationship between financial development and economic growth in Namibia. It employed an auto-regression distributive lag modelling approach on quarterly data for the period 1995 to 2014. The study used the following variables, namely: ratio of broad money supply to gross domestic product, real gross domestic product (GDP), saving and interest rate. Firstly, the results of the unit root tests showed a combination of integration of order zero and one. Secondly, the results for co-integration revealed the existence of a long-run stable relationship among the variables. Thirdly, the ratio of broad money supply to gross domestic product was found to have a negative and statistical significant relationship with economic activity. This suggests a negative relationship between financial development and economic activity in Namibia. Similarly, real interest rate and saving were also found to have a negative and statistically insignificant relationship with economic activity. On the contrary, the lagged real gross domestic product was found to have a positive and statistically insignificant relationship with economic activity.
Description
A thesis submitted in partial fulfilment of the requirements for the Degree of Master of Science in Economics
Keywords
Financial development, Economic growth