Breadcrumbs Image

Working Paper Series

  • Home
  • dLibrary //
  • API Publications //
  • Working Paper Series
dLibrary // API Publications

Working Paper Series - Financial-Growth Nexus in Sudan: Empirical Assessment Based On An Autoregressive Distributed LAG (ARDL) Model



API Publications

dLibrary

Financial-Growth Nexus in Sudan: Empirical Assessment Based On An Autoregressive Distributed LAG (ARDL) Model


Volume : 0

No : 0

ISSN : WPS0803

Publisher : Arab Planning Institute - Kuwait

Author (s) : Sufian Eltayeb Mohamed 

Published Date : 1/1/2008


Contents :
This study investigates theeffect of financial development on economic performance in Sudan over theperiod (1970- 2004). The short-run and long-run relationship between financialdevelopment and economic growth and other conditioning variables on economicgrowth are estimated by using the most recently developed autoregressivedistributed lag (ARDL) approach to co- integration analysis proposed by Pesaranand Shin (1999).The results overwhelmingly indicate a weak relationship betweenfinancial development and economic growth in Sudan. Although the coefficient ofM3/GDP is significant, it is negative, whilst the impact of credit to privatesector by banks to real GDP is negative and insignificant. These findings maybe attributed to the inefficient allocation of resources by banks, along withthe absence of an appropriate investment climate required to foster significantprivate investment and promote growth in the long run, and to the poor qualityof credit disbursal of the banking sector in Sudan. Moreover, the econometricanalysis suggest that the speed of adjustment in the estimated models isrelatively high and had the expected significant and negative sign. 

Download File (Free)