Interplay between financial sector and institutional framework in the economic growth process of Kenya
Bibliographic Data
| ID | 12705686 |
|---|---|
| Authors | Clement Olalekan Olaniyi (0000-0003-0758-4830, Department of Economics Obafemi Awolowo University Ile‐Ife Nigeria, corresponding author), Sunday Idowu Oladeji (Department of Economics Obafemi Awolowo University Ile‐Ife Nigeria) |
| Year | 2020 |
| Volume | 22 |
| Issue | 3 |
| Publication date | 2020-11-26 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Journal of Public Affairs (JOURNAL) |
| Journal identifiers | ISSN: 1472-3891 • E-ISSN: 1479-1854 |
| Publisher | Wiley (PUBLISHER • GB) |
| DOI | 10.1002/pa.2562 |
| OpenAlex | W3108886698 |
| Language | EN |
| Citations received | 7 |
| References cited | 116 |
In line with the recent assertion that institutional quality matters in the way financial development influences economic growth in financial economics literature, this study examines the moderating role of institutional quality in the finance‐growth nexus in Kenya for the period 1986–2015. A fully modified ordinary least square (FMOLS) estimator is adopted to take care of endogeneity problem inherent in the relationship among the variables while error‐correction version of autoregressive distributed lag (ARDL) technique is adopted to take care of short‐ and long‐run effects. The research outputs reveal that in the short‐run institutions and finance complement and reinforce each other to enhance growth, while institutional framework in Kenya constitutes a drain that leaks out the growth benefits of financial development in the long run. It is also found that the country majorly operates below the threshold level of institutional quality required to maximize the growth benefits of financial development. This study, therefore, concludes that institutional framework guiding the operations of financial system in Kenya should be strengthened so as to block loopholes and lapses that leak out the growth benefits of finance. JEL CLASSIFICATION D53; E02; N27; O43
Assertion · Cointegration · Distributed lag · Econometrics · Economics · Endogeneity · Error correction model · Macroeconomics · Nexus (standard · Public economics · Quality (philosophy · Short run · Economic Growth and Development · Fiscal Policy and Economic Growth · Islamic Finance and Banking Studies · Finance
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| Unique citing works | 7 |
|---|---|
| Citations per year | 2,33 |
| Citation span | 2023 - 2025 (3) |
| Citation velocity | recent |
| Highly cited | No |
| Citation types | Neutral: 7 |