Topic
Financial sector development
About: Financial sector development is a research topic. Over the lifetime, 1674 publications have been published within this topic receiving 90787 citations.
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TL;DR: In this article, the authors investigated the relationship between financial sector development and unemployment in Nigeria and found that formal credit allocation in rural areas has both short run and long run effect of reducing unemployment.
Abstract: Financial sector development has been identified by financial economists as a veritable way of empowering the poor thereby paving the way for enabling them to become employed and possibly serve as economic agents of change. This study empirically investigates the relationship between financial sector development and unemployment in Nigeria. A time series data was generated from 1980 to 2011 period. Auto Regressive Distributed Lag (ARDL) Bound Testing technique for cointegration was applied to estimate the long run relationship. The study found that there has been persistent unemployment in Nigeria, while formal credit allocation in rural areas has both short run and long run effect of reducing unemployment. Also found in this study is that expansionary monetary measures did not fuel inflation significantly. The study therefore recommends that monetary authority should strengthen and deepen financial services industry, particularly, Deposit Money Banks, to provide necessary financial support to the teeming unemployed youth in the country.
15 citations
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TL;DR: In this paper, the authors provided an empirical analysis of the comparative study between the Economic Community of West African States (ECOWAS) and Southern African Development Community (SADC) on the role of inflation in explaining the state of financial development of the two regions.
Abstract: This paper provides an empirical analysis of the comparative study between the Economic Community of West African States (ECOWAS) and Southern African Development Community (SADC) on the role of inflation in explaining the state of financial development of the two regions. In addition, the study seeks to find out if Rajan and Zingales Hypothesis which argues that simultaneous opening of both trade and financial sector is the key for financial development to take place is supported in the two regions. Using dynamic panel approach and data for the period 1980-2011, our findings provide evidence that in both regions inflation robustly reverse financial development with the effect in ECOWAS greatest. In addition, the study indicates that even though more simultaneously opening of the financial sector and trade lead to more financial development in SADC, trade openness alone can still trigger growth in the sector but more financial openness alone is detrimental to financial development of the region. Hence this seems to provide partial support for the hypothesis. However, the hypothesis is rejected in ECOWAS.
15 citations
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TL;DR: In this paper, the authors used monthly data to analyze the phenomenon of currency substitution in Cambodia during the recent economic and financial reform process, 1993-2001, and found that there is a significant long run relationship between the expected rate of depreciation in market exchange rates and holdings of US dollars.
Abstract: The tendency to substitute domestic for foreign currency (as a way of holding wealth and a means of transaction for goods and services) is common throughout the world, and particularly so in countries attempting to overcome thin financial institutions or errant monetary policy. This paper uses monthly data to analyze the phenomenon of currency substitution in Cambodia during the recent economic and financial reform process, 1993-2001. Results show that there is a significant long run relationship between the expected rate of depreciation in market exchange rates and holdings of US dollars. The implications of this result for macroeconomic policy and broader financial sector developments in Cambodia are also examined.
14 citations
01 Jan 2002
14 citations
TL;DR: The authors analyzes the moderating effect the degree of economic growth has on the relationship between the development of the financial system and the micro finance industry activity and finds that under negative economic growth conditions, the financial sector has a negative impact on the activity of the microfinance sector, but when economic growth is high, the development has a positive effect on micro finance activity.
Abstract: This article analyzes the moderating effect the degree of economic growth has on the relationship between the development of the financial system and the microfinance industry activity. The hypotheses proposed establish that the influence of the development of the financial system on the activity of the microfinance sector will be different depending on the level of economic growth. The estimates were made using the System-GMM methodology for panel data, which allows controlling the unobservable heterogeneity and the problems of endogeneity. We find that the degree of economic growth affects the relationship between the financial sector development and microfinance activity. Under negative economic growth conditions, the development of the financial sector has a negative impact on the activity of the microfinance sector, but when economic growth is high, the development of the financial sector positively influences the activity of the microfinance sector.
14 citations