Abstract
Economic growth is the most desirous goal of any country and
this article attempts to capture the impact of banking sector and
secondary market on economic growth. Financial development
has been categorized into bank based and secondary market
based. In this model, seven high growing countries have been
taken from Asian countries. A rare research technique, Panel
SUR, has been adopted owing to hetroscadastidy and cross
country correlation in the long panel. Finding shows that stock
market liquidity is not significant in the panel whereas banking
credit to private sector to specific country is negatively related
with economic growth. Financial depth, foreign direct
investment, stock market quantum and stock market efficiency
have positive relationship with economic growth in the panel.
Secondary market variables have more impact in contrast to
bank based variables in the panel. Most influential country is
China while least one is Bangladesh in the panel .Policymakers
should focus especially on increasing financial depth,
enhancing secondary market activities by introducing more
stock markets, increasing foreign direct investment inflows and
improving stock markets’ liquidity to uplift economic growth
in the countries.
Aamir Azeem, Dr. Bilal Aziz, Atif Khan Jadoon. (2017) Better tool for economic growth? Banks or secondary markets; Empirical evidence from selected ASIAN countries, Paradigms , Vol 11, Issue 1.
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