EFFECT OF FINANCIAL DEVELOPMENT ON ECONOMIC GROWTH IN KENYA: EVIDENCE FROM TIME SERIES ANALYSIS
Journal Title: European Journal of Business and Social Sciences - Year 2015, Vol 3, Issue 11
Abstract
This paper examines the relationship between financial development and economic growth in Kenya using annual time series data. The analysis techniques employed in this study was autoregressive distributed lag (ARDL). This approach was useful in handling small sample size like in this study and to address the problem of endogeneity since the relationship between financial development and economic growth cannot be determined on a priori grounds. The results revealed that financial development exerts a positive and statistically significant effect on economic growth in Kenya hence confirming supply leading hypothesis. This was confirmed both in the short-run as well as in the long-run regression results. From policy perspective the policy makers need to formulate financial sector reform policies to ensure a well-functioning financial system that promotes domestic credit especially to productive sectors of the economy.
Authors and Affiliations
Mercy J. Kiprop| Department of Economics, Egerton University, 536 Njoro, Kenya. Egerton University, Kenya, Aquilars Kalio| Department of Economics, Egerton University, 536 Njoro, Kenya. Egerton University, Kenya, Lawrence kibet| Department of Economics, Egerton University, 536 Njoro, Kenya. Egerton University, Kenya, Symon Kiprop| Department of Economics, Egerton University, 536 Njoro, Kenya. Egerton University, Kenya
Keywords
Related Articles
- EP ID EP10547
- DOI -
- Views 320
- Downloads 16
ORDER PREFERENCE OF EFFECTIVE FACTORS ON QUALITY OF SERVICES IN BANKING INDUSTRY VIA MULTIPLE CRITERIA DECISION MAKING (MCDM) (CASE- STUDY: ISFAHAN SEPAH BANK 2013)
Today, many industries show a lot of attention toward attribute of services to provide customers’ satisfaction. The current study is purposed to review on prioritization of effective factors on quality of the given...
CHANGES AND TRENDS ARISING FROM THE BUCHAREST STOCK EXCHANGE IN THE NEED FOR THE ANALYSIS OF FINANCIAL INSTRUMENTS AT ROMPETROL WELL SERVICES PLC
Wishing to provide responses to a number of concrete and current issues, the present paper approaches the changes and trends of the Bucharest Stock Exchange (BSE) that may contribute to a better understanding of the p...
EXOGENOUS AND DIRECT OBSERVABLE FACTORS AFFECTING ATTITUDE – CASE STUDY ON ROMANIAN CAR MARKET
Attitude is the process that influences in the most visible way the actual consumption behavior, considering all consumer behavior processes. Although theorists have studied for the last century how attitude is formed...
IMPLEMENTING AN EVIDENCE- BASED EDUCATIONAL PROGRAM ON THE IMPORTANCE OF BREASTFEEDING TO WOMEN IN THEIR THIRD TRIMESTER OF PREGNANCY
Every hour of every day, almost 500 new mothers across the United States face the same decision: how to feed their newborns (Galson, 2009). Breastfeeding is recommended by the American Academy of Pediatrics Work Grou...
GENDER GAP IN LITERACY RATE IN MATHURA DISTRICT U.P. A GEOGRAPHICAL STUDY
Education is an important avenue for upgrading the economic and social conditions of the women. An attempt has been made in the paper to analyze literacy rate and gender gap in literacy rate in Mathura district. This...