1887

n African Finance Journal - A causality analysis between financial development and economic growth for Botswana

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Abstract

This paper analyses the causal relationship between financial development and economic growth in Botswana for the period 1977-2006, using Granger causality through co-integrated Vector Auto-regression methods and two proxies for financial development. Results show that there is a stable long-run relationship between financial development and economic growth regardless of which proxy for financial development is used. Further, results provide evidence of supply-leading and demand-leading views of finance-growth nexus; thus, suggesting that enhancement of both financial markets and real economy's activity would be an advisable development strategy for Botswana.

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/content/finj/12/1/EJC33747
2010-01-01
2016-12-03
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