The Asymmetric Influence of Financial Development on Economic Growth in Kenya
Evidence From NARDL
Bibliographic Data
| ID | 3211946 |
|---|---|
| Authors | Hao Chen (0000-0002-8873-8266, Jiangsu University), Duncan O Hongo (0000-0003-1069-7238, Jiangsu University, corresponding author), Max William Ssali (0000-0002-3051-8607, Jiangsu University), Maurice Simiyu Nyaranga (0000-0003-1127-0789, Jiangsu University), Consolata Wairimu Nderitu (Jiangsu University) |
| Year | 2020 |
| Volume | 10 |
| Issue | 1 |
| Pages | 215824401989407 |
| Publication date | 2020-01-01 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | SAGE Open (JOURNAL) |
| Journal identifiers | ISSN: 2158-2440 • E-ISSN: 2158-2440 |
| Publisher | SAGE Publications Inc (PUBLISHER) |
| DOI | 10.1177/2158244019894071 |
| OpenAlex | W3007180933 |
| Language | EN |
| Citations received | 15 |
| References cited | 38 |
This study analyzed the asymmetric effects of financial development on economic growth using a model augmented with inflation and government expenditure asymmetries to inform model specification. The research question used entails, Do their asymmetry changes significantly influence growth? Using the nonlinear auto-regressive distributive lag (NARDL), the most significant results posit that positive shocks in financial development in the short run and its negative shocks in the long run increase and decrease economic growth, respectively. Regarding inflation, its positive (negative) shocks in both runs, respectively, reduce (increase) economic growth. In comparison, positive shocks in financial development that spur growth in the short run and negative shocks in financial development (government expenditure) that increase (reduce) growth are the most domineering effects as the rest of the shocks insignificantly affect growth. Results clearly demonstrate to an environment steered by stable and sustainable inflation that regulated government expenditure and comprehensive financial system deepening would positively cause economic growth. Therefore, appropriate policies that favor low inflation and reduced government spending, expansion of feasibly reformed financial institutions, capital accumulation, and increased resource mobilization should be instituted if real growth is to positively happen
Capital accumulation · Capital expenditure · Economic growth · Economics · Financial deepening · Financial intermediary · Government spending · Human capital · Macroeconomics · Market economy · Monetary economics · Short run · Welfare · Economic Growth and Development · Fiscal Policy and Economic Growth · Islamic Finance and Banking Studies · Finance
Due to the Covid-19 pandemic
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| Unique citing works | 15 |
|---|---|
| Citations per year | 2,5 |
| Citation span | 2020 - 2025 (6) |
| Citation velocity | recent |
| Highly cited | No |
| Citation types | Neutral: 11 |