IDEAS home Printed from https://ideas.repec.org/a/ibn/ijefaa/v8y2016i8p1.html
   My bibliography  Save this article

The Impact of Financing on Economic Growth in Saudi Arabia

Author

Listed:
  • Mohammed AL Mahish

Abstract

This paper investigates the impact of the overall financing activities on economic growth in Saudi Arabia. The study developed a financing index that takes into account the overall available credit in Saudi Arabia. The index was shown to be sensitive to economic and political shocks such as the Arab Spring. Using Johnson cointegration approach, the paper found an evidence of long run relationship between real GDP per capita, financing, real interest real, public labor force, and capital. Using a vector error correction model, the paper found a robust estimate that proves the positive impact of financing on economic growth in Saudi Arabia. Furthermore, Granger-Causality Wald test indicates that financing influences economic growth in Saudi Arabia.

Suggested Citation

  • Mohammed AL Mahish, 2016. "The Impact of Financing on Economic Growth in Saudi Arabia," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 8(8), pages 1-1, August.
    • Handle: RePEc:ibn:ijefaa:v:8:y:2016:i:8:p:1
    as

    Download full text from publisher

    File URL: http://www.ccsenet.org/journal/index.php/ijef/article/download/59624/33027
    Download Restriction: no
    File URL: http://www.ccsenet.org/journal/index.php/ijef/article/view/59624
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. repec:cup:cbooks:9781107034662 is not listed on IDEAS
    2. Ben Jedidia, Khoutem & Boujelbène, Thouraya & Helali, Kamel, 2014. "Financial development and economic growth: New evidence from Tunisia," Journal of Policy Modeling, Elsevier, vol. 36(5), pages 883-898.
    3. Gozgor,G. & Gozgor, K., 2013. "The Relationship between Domestic Credit and Income: Evidence from Latin America," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 13(1), pages 89-98.
    4. Brooks,Chris, 2014. "Introductory Econometrics for Finance," Cambridge Books, Cambridge University Press, number 9781107661455, December.
    5. Suna Korkmaz, 2015. "Impact of Bank Credits on Economic Growth and Inflation," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 5(1), pages 1-4.
    6. John C. Anyanwu, 2014. "Factors Affecting Economic Growth in Africa: Are There any Lessons from China?," African Development Review, African Development Bank, vol. 26(3), pages 468-493, September.
    7. Valentina Hartarska & Denis Nadolnyak & Xuan Shen, 2015. "Agricultural credit and economic growth in rural areas," Agricultural Finance Review, Emerald Group Publishing Limited, vol. 75(3), pages 302-312, September.
    8. Magda Kandil & Muhammad Shahbaz & Samia Nasreen, 2015. "The interaction between globalization and financial development: new evidence from panel cointegration and causality analysis," Empirical Economics, Springer, vol. 49(4), pages 1317-1339, December.
    9. Rihab Grassa & Kaouthar Gazdar, 2014. "Financial development and economic growth in GCC countries," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 41(6), pages 493-514, June.
    10. Chee-Keong Choong, 2012. "Does domestic financial development enhance the linkages between foreign direct investment and economic growth?," Empirical Economics, Springer, vol. 42(3), pages 819-834, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jagadish Prasad Bist & Nar Bahadur Bista, 2018. "Finance–Growth Nexus in Nepal: An Application of the ARDL Approach in the Presence of Structural Breaks," Vikalpa: The Journal for Decision Makers, , vol. 43(4), pages 236-249, December.
    2. Tanni Roy & Md. Emran Hossain & Md. Jahid Ebn Jalal & Jiban Krishna Saha & Eshrat Sharmin & Md. Akhtaruzzaman Khan, 2021. "Effects of credit on national and agricultural GDP, and poverty: a developing country perspective," SN Business & Economics, Springer, vol. 1(10), pages 1-20, October.
    3. Jagadish Prasad Bist, 2018. "Financial development and economic growth: Evidence from a panel of 16 African and non-African low-income countries," Cogent Economics & Finance, Taylor & Francis Journals, vol. 6(1), pages 1449780-144, January.
    4. Heidari , Hassan & Refah-Kahriz, Arash & Hashemi Berenjabadi, Nayyer, 2018. "Dynamic Relationship between Macroeconomic Variables and Stock Return Volatility in Tehran Stock Exchange: Multivariate MS ARMA GARCH Approach," Quarterly Journal of Applied Theories of Economics, Faculty of Economics, Management and Business, University of Tabriz, vol. 5(2), pages 223-250, August.
    5. Amar Anwar & Ichiro Iwasaki, 2023. "The finance–growth nexus in the Middle East and Africa: A comparative meta‐analysis," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(4), pages 4655-4683, October.
    6. Daniya Tlegenova, 2015. "Forecasting Exchange Rates Using Time Series Analysis: The sample of the currency of Kazakhstan," Papers 1508.07534, arXiv.org.
    7. Chirwa, Themba G. & Odhiambo, Nicholas M., 2016. "What Drives Long-Run Economic Growth? Empirical Evidence from South Africa," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 69(4), pages 429-456.
    8. Samargandi, Nahla & Fidrmuc, Jan & Ghosh, Sugata, 2015. "Is the Relationship Between Financial Development and Economic Growth Monotonic? Evidence from a Sample of Middle-Income Countries," World Development, Elsevier, vol. 68(C), pages 66-81.
    9. Faroque Ahmed & Md. Jamal Hossain & Mohammad Tareque, 2020. "Investigating the Roles of Physical Infrastructure, Financial Development and Human Capital on Economic Growth in Bangladesh," Journal of Infrastructure Development, India Development Foundation, vol. 12(2), pages 154-175, December.
    10. Chow, Sheung Chi & Vieito, João Paulo & Wong, Wing Keung, 2019. "Do both demand-following and supply-leading theories hold true in developing countries?," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 513(C), pages 536-554.
    11. Hui Wang & Huifang Liu, 2017. "An Empirical Research of FDI Spillovers and Financial Development Threshold Effects in Different Regions of China," Sustainability, MDPI, vol. 9(6), pages 1-21, June.
    12. Mădălina Viorica MANU & Ilie VASILE, 2019. "Challenging the status quo: Steel producer case study on the enterprise value for M&A," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(3(620), A), pages 99-114, Autumn.
    13. Dakpogan, Arnaud & Smit, Eon, 2018. "The effect of electricity losses on GDP in Benin," MPRA Paper 89545, University Library of Munich, Germany.
    14. Muhammad Shahbaz & Hrushikesh Mallick & Mantu Kumar Mahalik & Shawkat Hammoudeh, 2018. "Is globalization detrimental to financial development? Further evidence from a very large emerging economy with significant orientation towards policies," Applied Economics, Taylor & Francis Journals, vol. 50(6), pages 574-595, February.
    15. Pierre J. Venter & Eben Maré, 2020. "GARCH Generated Volatility Indices of Bitcoin and CRIX," JRFM, MDPI, vol. 13(6), pages 1-15, June.
    16. Karthigai Prakasam Chellaswamy & Natchimuthu N & Muhammadriyaj Faniband, 2020. "Stock Market Sensitivity to Macroeconomic Factors: Evidence from China and India," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 10(2), pages 146-159, February.
    17. Rudra P. Pradhan & Mak B. Arvin & Sahar Bahmani & Sara E. Bennett, 2017. "Broadband penetration, financial development, and economic growth nexus: evidence from the Arab League countries," Macroeconomics and Finance in Emerging Market Economies, Taylor & Francis Journals, vol. 10(2), pages 151-171, May.
    18. Viktor Stojkoski & Zoran Utkovski & Ljupco Kocarev, 2016. "The Impact of Services on Economic Complexity: Service Sophistication as Route for Economic Growth," PLOS ONE, Public Library of Science, vol. 11(8), pages 1-29, August.
    19. Marwil J. Dávila-Fernández, 2018. "Alternative Approaches to Technological Change when Growth is BoPC," Department of Economics University of Siena 795, Department of Economics, University of Siena.
    20. Ono, Shigeki, 2017. "Financial development and economic growth nexus in Russia," Russian Journal of Economics, Elsevier, vol. 3(3), pages 321-332.

    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ibn:ijefaa:v:8:y:2016:i:8:p:1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Canadian Center of Science and Education (email available below). General contact details of provider: https://edirc.repec.org/data/cepflch.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.