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).

Downloads

Download data is not yet available.

References

Amaira, B. (1993). FINANCE AND GROWTH: SCHUMPETER MIGHT BE RIGHT. The Quarterly Journal of Economics, 108(3).

Amaira, B. (2017). Reforms and performances of the Tunisian financial system. Tunisian Institute of Competitiveness and Quantitative Studies(46), p. 06.

Amsler, C., & Lee, J. (1995). An LM Test for a Unit Root in the Presence of a Structural Change. Econometric Theory, 11(2), 359-360.

Arltová, M., & Fedorová, D. (2016). Selection of Unit Root Test on the Basis of Length of the Time Series and Value of AR(1) Parameter. Statistika: Statistics and Economy Journal, 96(3).

Brou, E. A. (2005). THE ROLE OF CAPITAL MARKETS IN ECONOMIC GROWTH AND DEVELOPMENT. doctoral thesis. Faculty of Economic Sciences and Management, Clermont-Ferrand: University of Auvergne.

King, R., & Levine, R. (1993). FINANCE AND GROWTH: SCHUMPETER MIGHT BE RIGHT. The Quarterly Journal of Economics, 108(3).

Lee, C., & Chien, M. (2008). Structural breaks, tourism development, and economic growth: Evidence from Taiwan. Mathematics and Computers in Simulation,, 77(4), 362-363.

Levine, R. (1997). Financial Development and Economic Growth: Views and Agenda. Journal of Economic Literature, 35(2).

Patrick, H. T. (1966). Financial Development and Economic Growth in Underdeveloped Countries. Economic Development and Cultural Change,, 14(2).

Perron, P. (1989). The Great Crash, the Oil Price Shock, and the Unit Root Hypothesis. Econometrica, 57(6), 1361-1401.

Sahrawi, D. (2017). An Econometric Study of the Impact of Financial Liberalization Policy on Economic Growth: Case Study of Algeria during the Period 1990-2014. Doctoral dissertation. Faculty of Economic Sciences, Commercial Sciences and Management Sciences, Médéa: Yahia Fares University.

Stemmer, M. A. (2016). Essays on Growth, Unemployment and Financial Development . PhD thesis. Paris, Maison des Sciences Économiques, France: University of Paris 1 Panthéon-Sorbonne.

Thao, N. T. (2005). THE RELATIONSHIP BETWEEN DEVELOPMENT AND ECONOMIC GROWTH: CASE OF VIETNAM. Master's thesis. School of Management Sciences, Montreal: UNIVERSITY OF QUEBEC AT MONTREAL.

Downloads

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

License

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

You are free to:

  1. Share — copy and redistribute the material in any medium or format for any purpose, even commercially.
  2. Adapt — remix, transform, and build upon the material for any purpose, even commercially.
  3. The licensor cannot revoke these freedoms as long as you follow the license terms.

Under the following terms:

  1. Attribution — You must give appropriate credit , provide a link to the license, and indicate if changes were made . You may do so in any reasonable manner, but not in any way that suggests the licensor endorses you or your use.
  2. No additional restrictions — You may not apply legal terms or technological measures that legally restrict others from doing anything the license permits.

Notices:

You do not have to comply with the license for elements of the material in the public domain or where your use is permitted by an applicable exception or limitation .

No warranties are given. The license may not give you all of the permissions necessary for your intended use. For example, other rights such as publicity, privacy, or moral rights may limit how you use the material.