IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/119958.html
   My bibliography  Save this paper

The role of the New Development Bank on Economic growth and Development in the BRICS states

Author

Listed:
  • Sithole, Mixo Sweetness
  • Hlongwane, Nyiko Worship

Abstract

The purpose of this study is to analyse how the BRICS countries' New Development Bank (NDB) promotes economic growth and development. This study aims to evaluate the influence of the NDB on crucial measures of economic growth and development in the BRICS nations by a thorough review of the bank's operations, financing mechanisms, and project portfolios. The study utilized the panel data from 1997-2022 using variables such as economic growth, employment, and trade. The study deployed a PMG estimator and Granger causality model. The results revealed positive bidirectional statistically significant relationship between broad money and economic growth in BRICS. The study recommended that NDB should promote growth of broad money as it boosts economic growth.

Suggested Citation

  • Sithole, Mixo Sweetness & Hlongwane, Nyiko Worship, 2023. "The role of the New Development Bank on Economic growth and Development in the BRICS states," MPRA Paper 119958, University Library of Munich, Germany, revised 26 Jan 2024.
    • Handle: RePEc:pra:mprapa:119958
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/119958/1/MPRA_paper_119958.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Guglielmo Maria Caporale & Christophe Rault & Anamaria Diana Sova & Robert Sova, 2015. "Financial Development and Economic Growth: Evidence from 10 New European Union Members," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 20(1), pages 48-60, January.
    2. Morena Skalamera Groce & Seçkin Köstem, 2023. "The dual transformation in development finance: western multilateral development banks and China in post-Soviet energy," Review of International Political Economy, Taylor & Francis Journals, vol. 30(1), pages 176-200, January.
    3. Chiara Broccolini & Giulia Lotti & Alessandro Maffioli & Andrea F Presbitero & Rodolfo Stucchi, 2021. "Mobilization Effects of Multilateral Development Banks," The World Bank Economic Review, World Bank, vol. 35(2), pages 521-543.
    4. Law, Siong Hook & Singh, Nirvikar, 2014. "Does too much finance harm economic growth?," Journal of Banking & Finance, Elsevier, vol. 41(C), pages 36-44.
    5. McLeay, Michael & Radia, Amar & Thomas, Ryland, 2014. "Money creation in the modern economy," Bank of England Quarterly Bulletin, Bank of England, vol. 54(1), pages 14-27.
    6. Shimeles Abebe & Adeleke Oluwole Salami & Anthony M. Simpasa, 2015. "Working Paper 221 - Employment Effects of Multilateral Development Bank Projects The Case of the African Development Bank," Working Paper Series 2160, African Development Bank.
    7. Hu, Bo & Schclarek, Alfredo & Xu, Jiajun & Yan, Jianye, 2022. "Long-term finance provision: National development banks vs commercial banks," World Development, Elsevier, vol. 158(C).
    8. Frigerio, Marco & Vandone, Daniela, 2020. "European development banks and the political cycle," European Journal of Political Economy, Elsevier, vol. 62(C).
    9. Biswas, Rajiv, 2015. "Reshaping the financial architecture for development finance: the new development banks," LSE Research Online Documents on Economics 61120, London School of Economics and Political Science, LSE Library.
    10. Sam Jones & John Page & Abebe Shimeles & Finn Tarp & Anthony Simpasa & Abebe Shimeles & Adeleke O. Salami, 2015. "Employment Effects of Multilateral Development Bank Support: The Case of the African Development Bank," African Development Review, African Development Bank, vol. 27(S1), pages 31-43, October.
    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. Simplice A. Asongu & Joseph I. Uduji & Elda N. Okolo-Obasi, 2020. "Foreign aid volatility and lifelong learning," International Journal of Education Economics and Development, Inderscience Enterprises Ltd, vol. 11(4), pages 370-406.
    2. Asongu, Simplice & Odhiambo, Nicholas, 2019. "Foreign Aid Complementarities and Inclusive Human Development in Africa," MPRA Paper 101086, University Library of Munich, Germany.
    3. Charalampos Agiropoulos & Michael L. Polemis & Michael Siopsis & Sotiris Karkalakos, 2022. "Revisiting the finance‐growth nexus: A socioeconomic approach," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(3), pages 2762-2783, July.
    4. Gong, Di & Xu, Jiajun & Yan, Jianye, 2023. "National development banks and loan contract terms: Evidence from syndicated loans," Journal of International Money and Finance, Elsevier, vol. 130(C).
    5. Fumitaka Furuoka, 2017. "Determinants of China's and Japan's Foreign Aid Allocations in Africa," African Development Review, African Development Bank, vol. 29(3), pages 376-388, September.
    6. Botta, Alberto & Caverzasi, Eugenio & Russo, Alberto & Gallegati, Mauro & Stiglitz, Joseph E., 2021. "Inequality and finance in a rent economy," Journal of Economic Behavior & Organization, Elsevier, vol. 183(C), pages 998-1029.
    7. John Ssozi & Simplice Asongu & Voxi Heinrich Amavilah, 2019. "The effectiveness of development aid for agriculture in Sub-Saharan Africa," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 46(2), pages 284-305, March.
    8. Clavero, Borja, 2017. "A contribution to the Quantity Theory of Disaggregated Credit," MPRA Paper 76657, University Library of Munich, Germany.
    9. Agne Setikiene & Mindaugas Butkus, 2021. "The Heterogeneous Impact of Financialisation on Economic Growth in the Long Run," JRFM, MDPI, vol. 14(5), pages 1-30, May.
    10. Dombi, Ákos & Grigoriadis, Theocharis, 2020. "State history and the finance-growth nexus: Evidence from transition economies," Economic Systems, Elsevier, vol. 44(1).
    11. Ssozi, John & Asongu, Simplice & Amavilah, Voxi, 2017. "Is Aid for Agriculture Effective in Sub-Saharan Africa?," MPRA Paper 83073, University Library of Munich, Germany.
    12. Eglantina Hysa & Naqeeb Ur Rehman, 2023. "Economic Growth Through Financial Development: Empirical Evidences from New Member States and Western Balkan Countries," Springer Proceedings in Business and Economics, in: Luminita Chivu & Ignacio De Los Ríos Carmenado & Jean Vasile Andrei (ed.), Crisis after the Crisis: Economic Development in the New Normal, chapter 0, pages 49-67, Springer.
    13. Florian LEON & Mavis OPOKU-BOSSMAN, 2024. "How Public Development Banks mobilize their resources to finance transitions?," Working Paper 805c7be4-b114-4389-a289-e, Agence française de développement.
    14. Dombi, Akos & Grigoriadis, Theocharis, 2017. "Ancestry, Diversity & Finance: Evidence from Transition Economies," Discussion Papers 2017/4, Free University Berlin, School of Business & Economics.
    15. Muhammad A Ingratubun & Akhmad Fauzi, 2021. "Opening the Black Box: Disbursement Delays Impacts on Growth in Asian Development Bank Loan Projects in Indonesia," ConScienS Conference Proceedings 029mi, Research Association for Interdisciplinary Studies.
    16. Lo Turco, Alessia & Maggioni, Daniela & Zazzaro, Alberto, 2019. "Financial dependence and growth: The role of input-output linkages," Journal of Economic Behavior & Organization, Elsevier, vol. 162(C), pages 308-328.
    17. Jan Fagerberg & Martin Srholec, 2017. "Global Dynamics, Capabilities and the Crisis," Economic Complexity and Evolution, in: Andreas Pyka & Uwe Cantner (ed.), Foundations of Economic Change, pages 83-106, Springer.
    18. Tongurai, Jittima & Vithessonthi, Chaiporn, 2018. "The impact of the banking sector on economic structure and growth," International Review of Financial Analysis, Elsevier, vol. 56(C), pages 193-207.
    19. Christopher F Baum & Mustafa Caglayan & Bing Xu, 2017. "The Impact of Uncertainty on Financial Institutions," Boston College Working Papers in Economics 939, Boston College Department of Economics, revised 20 Sep 2018.
    20. Bihari, Péter, 2015. "Odüsszeuszi utazás - az előretekintő iránymutatás tapasztalatai [An Odysseian journey - experience with forward guidance]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 749-766.

    More about this item

    Keywords

    New Development Bank; Economic growth; BRICS; Pooled Mean Group estimator; Granger causality.;
    All these keywords.

    JEL classification:

    • C0 - Mathematical and Quantitative Methods - - General
    • C3 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:pra:mprapa:119958. 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: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.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.