Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/141900
Authors: 
Nyasha, Sheilla
Odhiambo, Nicholas M.
Year of Publication: 
2015
Citation: 
[Journal:] Contemporary Economics [ISSN:] 2084-0845 [Publisher:] Vizja Press & IT [Place:] Warsaw [Volume:] 9 [Year:] 2015 [Issue:] 1 [Pages:] 93-108
Abstract: 
This paper examines the impact of both bank- and market-based financial development on economic growth in South Africa during the period from 1980 to 2012. Unlike some previous studies, the current study employs means-removed average to construct both bank- and market-based financial development indices. The study uses the newly developed autoregressive distributed lag (ARDL) bounds testing approach to examine this linkage. The empirical results of this study show that there is a positive relationship between bank-based financial development and economic growth in South Africa. The results, however, fail to find any relationship between market-based financial development and economic growth in South Africa. The results apply irrespective of whether the regression analysis is conducted in the short run or in the long run. These results imply that it is bank-based financial development rather than market-based financial development that plays a pivotal role in propelling South Africa's real sector.
Subjects: 
South Africa
Bank-based Financial Development
Market-based Financial Development
Economic Growth
JEL: 
G10
G20
O16
Persistent Identifier of the first edition: 
Document Type: 
Article
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