Impact of primary market on total factor productivity: A cross-country analysis
Schumpeter argued that entrepreneurial finance causes the absorption of innovation in the economy and productivity growth. Previous empirical work, however, reported an insignificant relationship between the primary equity market and economic growth, and suggested exploration of the routes through w...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Taylor & Francis Group
2020-01-01
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| Series: | Cogent Economics & Finance |
| Subjects: | |
| Online Access: | http://dx.doi.org/10.1080/23322039.2020.1786293 |
| _version_ | 1818621303811211264 |
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| author | Vinod Kumar Ganesh Kumar Nidugala |
| author_facet | Vinod Kumar Ganesh Kumar Nidugala |
| author_sort | Vinod Kumar |
| collection | DOAJ |
| description | Schumpeter argued that entrepreneurial finance causes the absorption of innovation in the economy and productivity growth. Previous empirical work, however, reported an insignificant relationship between the primary equity market and economic growth, and suggested exploration of the routes through which the primary equity market may affect economic growth. In the present study, we examined the impact of the primary equity market on total factor productivity (TFP) and non-TFP growth in a cross-country setting using panel data analysis and the GMM approach. We employed published data relating to 87 countries for the period 1990–2014. We found a positive impact of the primary equity market on TFP in both developed and developing economies, without a significant difference. The impact of the primary equity market on non-TFP growth was found to be significant in developing economies only. The findings suggest that the primary equity market boosts growth in all economies, but the impact is higher in developing economies. Findings of the study suggest that policy makers should focus on developing primary equity market to foster economic growth. |
| first_indexed | 2024-12-16T18:07:08Z |
| format | Article |
| id | doaj.art-550098b2bf3a4486ac34969ccaa9887f |
| institution | Directory Open Access Journal |
| issn | 2332-2039 |
| language | English |
| last_indexed | 2024-12-16T18:07:08Z |
| publishDate | 2020-01-01 |
| publisher | Taylor & Francis Group |
| record_format | Article |
| series | Cogent Economics & Finance |
| spelling | doaj.art-550098b2bf3a4486ac34969ccaa9887f2022-12-21T22:21:53ZengTaylor & Francis GroupCogent Economics & Finance2332-20392020-01-018110.1080/23322039.2020.17862931786293Impact of primary market on total factor productivity: A cross-country analysisVinod Kumar0Ganesh Kumar Nidugala1Indian Institute of Management IndoreIndian Institute of Management IndoreSchumpeter argued that entrepreneurial finance causes the absorption of innovation in the economy and productivity growth. Previous empirical work, however, reported an insignificant relationship between the primary equity market and economic growth, and suggested exploration of the routes through which the primary equity market may affect economic growth. In the present study, we examined the impact of the primary equity market on total factor productivity (TFP) and non-TFP growth in a cross-country setting using panel data analysis and the GMM approach. We employed published data relating to 87 countries for the period 1990–2014. We found a positive impact of the primary equity market on TFP in both developed and developing economies, without a significant difference. The impact of the primary equity market on non-TFP growth was found to be significant in developing economies only. The findings suggest that the primary equity market boosts growth in all economies, but the impact is higher in developing economies. Findings of the study suggest that policy makers should focus on developing primary equity market to foster economic growth.http://dx.doi.org/10.1080/23322039.2020.1786293primary equity markettotal factor productivityschumpeter modelmckinnon modeleconomic growth |
| spellingShingle | Vinod Kumar Ganesh Kumar Nidugala Impact of primary market on total factor productivity: A cross-country analysis Cogent Economics & Finance primary equity market total factor productivity schumpeter model mckinnon model economic growth |
| title | Impact of primary market on total factor productivity: A cross-country analysis |
| title_full | Impact of primary market on total factor productivity: A cross-country analysis |
| title_fullStr | Impact of primary market on total factor productivity: A cross-country analysis |
| title_full_unstemmed | Impact of primary market on total factor productivity: A cross-country analysis |
| title_short | Impact of primary market on total factor productivity: A cross-country analysis |
| title_sort | impact of primary market on total factor productivity a cross country analysis |
| topic | primary equity market total factor productivity schumpeter model mckinnon model economic growth |
| url | http://dx.doi.org/10.1080/23322039.2020.1786293 |
| work_keys_str_mv | AT vinodkumar impactofprimarymarketontotalfactorproductivityacrosscountryanalysis AT ganeshkumarnidugala impactofprimarymarketontotalfactorproductivityacrosscountryanalysis |