Financialization and Economic Growth Nexus in South Africa

Mabeba, Mahlatse Ruphus (2023) Financialization and Economic Growth Nexus in South Africa. Journal of Economics and Financial Analysis, 7 (1). pp. 61-78. DOI

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We empirically investigate the effects of financialization on economic growth in South Africa. The country experienced increases in the share of the financial sector since the democratic dispensation. This country is also one of the few developing countries with a large financial market. The sample period includes a long-run horizon from 1994 to 2021. The study applies quantile regression methodology which we use to explain the effects of financialization at different levels of economic growth. We estimate the effects of financialization at the 25th, 50th, 75th percentile of economic growth. The key measure of financialization is the finance gross value added and the measure of economic growth is the gross domestic product. We find that financialization has a significantly high and positive effect only at all the levels of economic growth. From the different percentiles, financialization contributes more to higher levels of economic growth.

Item Type:Article
Uncontrolled Keywords:financialization, economic growth, quantile regression, South Africa
JEL classification:F65 - Economic Impacts of Globalization: Finance
G18 - General Financial Markets: Government Policy and Regulation
G28 - Financial Institutions and Services: Government Policy and Regulation
Divisions:Corvinus Doctoral Schools
Subjects:Economic development
ID Code:8405
Deposited By: MTMT SWORD
Deposited On:18 Jul 2023 08:23
Last Modified:18 Jul 2023 08:23

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