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Stock markets and economic growth in oil exporting countries: evidence from Kuwait

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  • Bentour, El Mostafa

Abstract

This paper empirically investigates the role played by the Kuwait stock market on the real sector. It uses useful steps and techniques to set up a regression based on the Mankiw-Romer-Weil model to answer whether there is an eventually positive effect of the stock market developments on the real economy. The results show a positive impact of the market capitalisation on the Gross Domestic Product. The elasticity of the market capitalization to GDP is around 0.17. This impact is also confirmed by an autoregressive vector model via estimation and impulse response functions on both total and non oil GDP.

Suggested Citation

  • Bentour, El Mostafa, 2014. "Stock markets and economic growth in oil exporting countries: evidence from Kuwait," MPRA Paper 55997, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:55997
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    References listed on IDEAS

    as
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    2. Demirguc-Kunt, Ash & Levine, Ross, 1996. "Stock Markets, Corporate Finance, and Economic Growth: An Overview," The World Bank Economic Review, World Bank, vol. 10(2), pages 223-239, May.
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    4. Thorsten Beck, 2009. "The Econometrics of Finance and Growth," Palgrave Macmillan Books, in: Terence C. Mills & Kerry Patterson (ed.), Palgrave Handbook of Econometrics, chapter 25, pages 1180-1209, Palgrave Macmillan.
    5. Demetriades, Panicos O. & Hussein, Khaled A., 1996. "Does financial development cause economic growth? Time-series evidence from 16 countries," Journal of Development Economics, Elsevier, vol. 51(2), pages 387-411, December.
    6. Philippe Aghion & Steven Durlauf (ed.), 2005. "Handbook of Economic Growth," Handbook of Economic Growth, Elsevier, edition 1, volume 1, number 1.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Non oil GDP; Market Capitalization; Cobb-Douglas; Human Capital.;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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