Sectoral impact of bank credit in Malaysia: ARDL modelling approach
This study investigates the sectoral impacts of bank credit on economic output by analysing the long- and short-run effects of bank credit on the output of five major economic sectors in Malaysia. The sectors are the agriculture, manufacturing, mining and quarrying, construction and services sectors...
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| Format: | Article |
| Language: | English English |
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Universiti Putra Malaysia Press
2016
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| Online Access: | http://irep.iium.edu.my/51965/1/006%20Pertanika%20Abdulsalam.pdf http://irep.iium.edu.my/51965/7/51965_Sectoral%20impact%20of%20bank%20credit_Scopus.pdf |
| _version_ | 1825649860656758784 |
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| author | Abubakar, Abdulsalam Kassim, Salina |
| author_facet | Abubakar, Abdulsalam Kassim, Salina |
| author_sort | Abubakar, Abdulsalam |
| collection | IIUM |
| description | This study investigates the sectoral impacts of bank credit on economic output by analysing the long- and short-run effects of bank credit on the output of five major economic sectors in Malaysia. The sectors are the agriculture, manufacturing, mining and quarrying, construction and services sectors. It employed quarterly data from 1997Q1 to 2014Q4 and adopted the ARDL and ECM approaches. The results revealed that bank credit has uneven impacts on the economic sectors, with significant effects, particularly in the short run on the mining and quarrying, and manufacturing sectors, but no effect on the agriculture sector. In contrast, bank credit is found to have larger long-run impact on output of the construction and services sectors compared to the short run. Hence, the results suggest the importance of considering the sectoral-specific characteristics in extending bank financing to ensure the effectiveness of financing in supporting the growth of the sector. As for the agriculture sector, concessionary financing is needed since it is shown that the sector is not adequately being served by the banking system. |
| first_indexed | 2024-03-05T23:53:51Z |
| format | Article |
| id | oai:generic.eprints.org:51965 |
| institution | International Islamic University Malaysia |
| language | English English |
| last_indexed | 2024-03-05T23:53:51Z |
| publishDate | 2016 |
| publisher | Universiti Putra Malaysia Press |
| record_format | dspace |
| spelling | oai:generic.eprints.org:519652017-04-13T01:30:41Z http://irep.iium.edu.my/51965/ Sectoral impact of bank credit in Malaysia: ARDL modelling approach Abubakar, Abdulsalam Kassim, Salina HB Economic Theory HB522 Income. Factor shares.Interest.Profit.Entrepreneurship HG Finance HG1501 Banking This study investigates the sectoral impacts of bank credit on economic output by analysing the long- and short-run effects of bank credit on the output of five major economic sectors in Malaysia. The sectors are the agriculture, manufacturing, mining and quarrying, construction and services sectors. It employed quarterly data from 1997Q1 to 2014Q4 and adopted the ARDL and ECM approaches. The results revealed that bank credit has uneven impacts on the economic sectors, with significant effects, particularly in the short run on the mining and quarrying, and manufacturing sectors, but no effect on the agriculture sector. In contrast, bank credit is found to have larger long-run impact on output of the construction and services sectors compared to the short run. Hence, the results suggest the importance of considering the sectoral-specific characteristics in extending bank financing to ensure the effectiveness of financing in supporting the growth of the sector. As for the agriculture sector, concessionary financing is needed since it is shown that the sector is not adequately being served by the banking system. Universiti Putra Malaysia Press 2016-05 Article PeerReviewed application/pdf en http://irep.iium.edu.my/51965/1/006%20Pertanika%20Abdulsalam.pdf application/pdf en http://irep.iium.edu.my/51965/7/51965_Sectoral%20impact%20of%20bank%20credit_Scopus.pdf Abubakar, Abdulsalam and Kassim, Salina (2016) Sectoral impact of bank credit in Malaysia: ARDL modelling approach. Pertanika Journal of Social Science and Humanities, 24 (S). pp. 205-211. ISSN 0128-7702 http://www.pertanika.upm.edu.my/regular_issues.php?jtype=3&journal=JSSH-24-S-5 |
| spellingShingle | HB Economic Theory HB522 Income. Factor shares.Interest.Profit.Entrepreneurship HG Finance HG1501 Banking Abubakar, Abdulsalam Kassim, Salina Sectoral impact of bank credit in Malaysia: ARDL modelling approach |
| title | Sectoral impact of bank credit in Malaysia: ARDL modelling approach |
| title_full | Sectoral impact of bank credit in Malaysia: ARDL modelling approach |
| title_fullStr | Sectoral impact of bank credit in Malaysia: ARDL modelling approach |
| title_full_unstemmed | Sectoral impact of bank credit in Malaysia: ARDL modelling approach |
| title_short | Sectoral impact of bank credit in Malaysia: ARDL modelling approach |
| title_sort | sectoral impact of bank credit in malaysia ardl modelling approach |
| topic | HB Economic Theory HB522 Income. Factor shares.Interest.Profit.Entrepreneurship HG Finance HG1501 Banking |
| url | http://irep.iium.edu.my/51965/1/006%20Pertanika%20Abdulsalam.pdf http://irep.iium.edu.my/51965/7/51965_Sectoral%20impact%20of%20bank%20credit_Scopus.pdf |
| work_keys_str_mv | AT abubakarabdulsalam sectoralimpactofbankcreditinmalaysiaardlmodellingapproach AT kassimsalina sectoralimpactofbankcreditinmalaysiaardlmodellingapproach |