The Effect of Banking Industry Development on Economic Growth: An Empirical Study in Jordan

• 발행기관: 한국유통과학회
• 저자명: Hamed Ahmad ALMAHADIN Anwar AL-GASAYMEH Najed ALRAWASHDEH Yousef ABU SIAM
• 간행물 정보: 『The Journal of Asian Finance, Economics and Business(JAFEB)』Vol. 8 No.5, 325~334쪽, 전체 10쪽
• 주제분류: 경제경영 > 경제학
• 파일형태: PDF
• 발행일자: 2021.05.30

영문 초록

This study aims to investigate whether economic growth is elevated by banking industry development in Jordan. The study adopts time-series econometric methodologies, which comprise the bounds testing approach within the autoregressive distributed lag (ARDL) and the conditional causality analysis. Consistent with the assumptions of the adopted methodology, the study utilized annual time-series data for a relatively long period of thirty-nine years, between 1980 and 2018. The empirical results show that Jordan’s economic growth is strongly responsive in respect to any changes in banking industry development. Also, the results reveal the harmful impact of rising lending interest rate; as this rate increases, economic growth will decrease. The findings are in line with the conceptual arguments of the supply-leading hypothesis, which confirmed that banking development is considered as one of the main pillars that have stimulating effects on economic growth. The evidence of the current study may provide important implications for policymakers and bankers. Those professionals should work to maintain a stable regulatory system that enhances the banking system function in activating economic growth. Also, a considerable focus should be placed on designing a steady interest rate policy to avoid the inherently undesirable impacts of high-interest rates on the Jordanian economy.

목차

1. Introduction

2. Literature Review

3. Model Specification

4. Econometric Methodology

5. Empirical Results

6. Conclusion and Policy Implications

키워드

Banking Industry Economic Growth ARDL Conditional Granger Causality Jordan