ID | 079935 |
Title Proper | Financial Development, capital accumulation and productivity improvement |
Other Title Information | evidence from China |
Language | ENG |
Author | Lu, Xun ; Fausten, Dietrich K ; Smyth, Russell |
Publication | 2007. |
Summary / Abstract (Note) | Financial sector development may contribute to economic growth by facilitating capital accumulation and by improving productivity. This article investigates empirically the contribution that financial development may make to these two alternative drivers of economic growth in China using annual data for the period 1952 to 2005. Using cointegration and Granger-causality testing we examine the relationship between financial development and, respectively, capital accumulation and productivity in a time-series vector autoregression (VAR) framework. The substantive findings are that there is either bi-directional Granger causality between financial development and capital accumulation or that Granger causality runs from capital accumulation to financial development, depending on how capital accumulation and financial development are measured. The link between financial development and productivity is found to be statistically weak |
`In' analytical Note | Journal of Chinese Econonics and Business Studies Vol. 5, No.3; Nov 2007: p227-242 |
Journal Source | Journal of Chinese Econonics and Business Studies Vol. 5, No.3; Nov 2007: p227-242 |
Key Words | Financial Development ; Economic Growth ; China ; Causality |