THE RELATIONSHIP BETWEEN BANK FINANCING AND ECONOMIC GROWTH IN TUNISIA: MULTIVARIATE CAUSALITY ANALYSIS

Authors

  • Mohamed Lamine Belhouchet Faculty of Economics, University of Tebessa, Algeria
  • Elhamza Ahmed University of Tunis Al-Manar, Faculty of Economics and Management, Tunisia

Keywords:

bank financing, economic growth, Toda & Yamamoto

Abstract

This study aimed to test the long-term causality relationship between bank financing and economic growth in Tunisia during the period from 1980 to 2020. It employed the Toda & Yamamoto (1995) methodology, which is based on the developed Augmented VAR model.

The study concluded that there is a bidirectional causal relationship between bank financing and economic growth. Therefore, bank financing is one of the causes leading to economic growth in Tunisia, aligning with most economic theories like those of Schumpeter (1911), Hicks (1969), Goldsmith (1969), McKinnon (1973), Shaw (1973), Fry (1988), Levine & King (1993), and Levine (1997). According to Patrick (1966), Tunisia is considered to be in the advanced stages of development because financial development follows economic growth and not vice versa (the demand-following phenomenon).

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Published

2024-03-05

How to Cite

Lamine Belhouchet, M. ., & Ahmed, E. . (2024). THE RELATIONSHIP BETWEEN BANK FINANCING AND ECONOMIC GROWTH IN TUNISIA: MULTIVARIATE CAUSALITY ANALYSIS. The Journal of Contemporary Issues in Business and Government, 30(1), 332–334. Retrieved from https://cibgp.com/au/index.php/1323-6903/article/view/2776

Issue

Vol. 30 No. 1 (2024): The journal of contemporary issues in business and government

Section

Articles

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