Financial Development and Economic Growth in Tanzania: An Empirical Investigation
Journal Title: International Journal of Academic Research in Business and Social Sciences - Year 2019, Vol 8, Issue 8
Abstract
Tanzania economy like of many other emerging market have seen rapid increase number of banks locally and foreign owned since financial sector liberalization in 1990’s even though clear impact of financial sector on economic growth is hard to be singled out. The paper investigates empirically the long run relationship between selected proxies of financial development and economic growth in the Tanzanian context. Using the vector error correction model (VECM), the study finds that financial development is cointegrated with economic growth. That is there is a long run relationship between chosen proxies of financial development and economic growth in the country. This paper used broad money supply M2, foreign direct investment, customer deposits in foreign and domestic banks, credit extended by foreign and domestic banks as percentage of GDP as proxies for financial development. While per capita growth rate used to measure economic growth. The results also show the need to develop even further the financial sector through appropriate regulatory and macroeconomic policies in order to ensure sustainable economic growth as well as economic development. For robustness of the results other test were also performed in this study such as Augmented-Dickey Fuller unit root test and Johansen cointegration test.
Authors and Affiliations
Mnaku Honest Maganya
Keywords
Related Articles
- EP ID EP565316
- DOI 10.6007/IJARBSS/v8-i8/4470
- Views 84
- Downloads 0
Leadership Style: Transformational and Employees’ Job Satisfaction in Sektor Khidmat Pengurusan dan Pembangunan at Jabatan Pendidikan Negeri Johor
To achieve job satisfaction among employees is the focal point of most organizations. It is because the issue of employee’s job satisfaction has been long debated due to its subjectivity. Therefore, an attempt has been...
ICT Usage Performance of Small and Medium Enterprises and Their Exporting Activity in Malaysia
The implementation of the SME Masterplan 2012-2020 for the small and medium enterprises (SMEs) is expected to raise contribution share to total exports in gross domestic product (GDP) by 2020 in Malaysia. In this regard,...
A Study of Premium Price Brands with Special Reference to Willingness of Customer to Pay
Use of premium price has become much gainful among brands for making unique and differentiate product among existing homogeneous product in the market. This marketing tool has gained key importance for the marketing rese...
Multiple Mediated Effect of Adult Attachment Style on Association between Acquired Skills from Gottman’s Intervention on Marital Communication Patterns
This research aimed to evaluate the multiple mediated effect of adult attachment style on acquired skills of Gottman’s psycho-educational intervention and marital communication patterns in 144 married people selected fro...
Instrumentation of Psychospiritual Scale for Malaysian Drug Rehabilitation Centres
The significance of spirituality element in one’s life is not to be silenced. The dualistic nature of human be it physical and spiritual seeks for the balance contentment as so one can achieve the tranquility of life and...