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Periodical article Periodical article Leiden University catalogue Leiden University catalogue WorldCat catalogue WorldCat
Title:Financial development and economic growth: evidence from Africa cross-sectional data
Author:Adesina-Uthman, Ganiyat A.ISNI
Periodical:Journal of Oriental and African Studies
Geographic term:Africa
Subjects:economic development
financial policy
Abstract:There is broad consensus in the literature on the existence of a positive relationship between financial development and economic growth. This article empirically assesses the impact of domestic private credit, as a proxy for financial development, on real Gross Domestic Product, a proxy for economic growth, in nine African countries over a period of 22 years (1984-2006). The results of the analysis support existing findings on finance-led growth if the necessary infrastructures are put in place. For a greater growth benefit from financial development, policymakers should ensure good maintenance of inflation and interest rates, and the provision of institutional infrastructure such as the protection of property rights and the supply of domestic private credit. Only when the financial system is embedded in a sound institutional framework can the larger effects of financial development on growth be realized, especially in poorer countries. App., bibliogr., notes, sum. [ASC Leiden abstract]