Financial development and economic growth in Indonesia: An ARDL-Bounds testing approach
The objective of this paper is to analyze the influence of financial development on economic growth in Indonesia using quarterly time series data for the period of 2005 to 2016. It uses an Autoregressive Distributed Lagged (ARDL-bounds) testing approach to cointegration to estimate the relationships...
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| Format: | Article |
| Language: | English |
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Universitas Islam Indonesia
2019-07-01
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| Series: | Economic Journal of Emerging Markets |
| Online Access: | http://uiistage.openjournaltheme.com/3310/index.php/JEP/article/view/10716 |
| _version_ | 1811262180635443200 |
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| author | Leli Sumarni |
| author_facet | Leli Sumarni |
| author_sort | Leli Sumarni |
| collection | DOAJ |
| description | The objective of this paper is to analyze the influence of financial development on economic growth in Indonesia using quarterly time series data for the period of 2005 to 2016. It uses an Autoregressive Distributed Lagged (ARDL-bounds) testing approach to cointegration to estimate the relationships among the variables. The financial development indicators used in this paper are financial credit, financial asset, and third-party funding. Findings/Originality: The results of the ARDL model estimates indicate that the variable is cointegrated and there is a long-run relationship between the variables, and therefore, there is a long-term causal relationship. The long-run estimation results disclose a significant positive relationship between economic growth and financial development, where economic growth is found to be significantly influenced by financial development indicators.
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| first_indexed | 2024-04-12T19:20:33Z |
| format | Article |
| id | doaj.art-76736c39657f4611be9d2743693ff3ed |
| institution | Directory Open Access Journal |
| issn | 2086-3128 2502-180X |
| language | English |
| last_indexed | 2024-04-12T19:20:33Z |
| publishDate | 2019-07-01 |
| publisher | Universitas Islam Indonesia |
| record_format | Article |
| series | Economic Journal of Emerging Markets |
| spelling | doaj.art-76736c39657f4611be9d2743693ff3ed2022-12-22T03:19:37ZengUniversitas Islam IndonesiaEconomic Journal of Emerging Markets2086-31282502-180X2019-07-01111Financial development and economic growth in Indonesia: An ARDL-Bounds testing approachLeli Sumarni0Universitas Andalas, Padang, IndonesiaThe objective of this paper is to analyze the influence of financial development on economic growth in Indonesia using quarterly time series data for the period of 2005 to 2016. It uses an Autoregressive Distributed Lagged (ARDL-bounds) testing approach to cointegration to estimate the relationships among the variables. The financial development indicators used in this paper are financial credit, financial asset, and third-party funding. Findings/Originality: The results of the ARDL model estimates indicate that the variable is cointegrated and there is a long-run relationship between the variables, and therefore, there is a long-term causal relationship. The long-run estimation results disclose a significant positive relationship between economic growth and financial development, where economic growth is found to be significantly influenced by financial development indicators. http://uiistage.openjournaltheme.com/3310/index.php/JEP/article/view/10716 |
| spellingShingle | Leli Sumarni Financial development and economic growth in Indonesia: An ARDL-Bounds testing approach Economic Journal of Emerging Markets |
| title | Financial development and economic growth in Indonesia: An ARDL-Bounds testing approach |
| title_full | Financial development and economic growth in Indonesia: An ARDL-Bounds testing approach |
| title_fullStr | Financial development and economic growth in Indonesia: An ARDL-Bounds testing approach |
| title_full_unstemmed | Financial development and economic growth in Indonesia: An ARDL-Bounds testing approach |
| title_short | Financial development and economic growth in Indonesia: An ARDL-Bounds testing approach |
| title_sort | financial development and economic growth in indonesia an ardl bounds testing approach |
| url | http://uiistage.openjournaltheme.com/3310/index.php/JEP/article/view/10716 |
| work_keys_str_mv | AT lelisumarni financialdevelopmentandeconomicgrowthinindonesiaanardlboundstestingapproach |