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Financial liberalization, financial development and growth in Sub-Saharan Africa's economic reform : an empirical investigation

conference contribution
posted on 2017-12-06, 00:00 authored by Abdullahi AhmedAbdullahi Ahmed
This paper uses the recent development in unit root tests and cointegration as applied to panel data and dynamic time series to estimate the relationship between financial liberalization, financial development and growth. We utilize data from 15 Sub-Saharan African countries and use the ratio of private sector credit and share of domestic credit to income as indicators of financial development. The results obtained from a hetrogenous panel investigation and times series methodology such as Granger causality indicate a long-run equilibrium relationship between financial development and economic growth. This is consistent with the view that financial development can act as an ‘engine of growth’ and plays a crucial role in the process of economic development. However, there is little evidence to support the hypothesis that financial liberalization directly ‘leads’ growth.


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Brisbane, Queensland


Faculty of Business, Queensland University of Technology

Place of Publication

Brisbane, Qld.

Peer Reviewed

  • Yes

Open Access

  • No

External Author Affiliations

Not affiliated to a Research Institute; Victoria University (Melbourne, Vic.);

Era Eligible

  • Yes

Name of Conference

Pacific Basin Finance, Economics, Accounting and Management

Parent Title

Proceedings of the 16th Annual Conference on Pacific Basin Finance, Economics, Accounting and Management, Queensland University of Technology, 2-4 July, Brisbane (PBFEAM 2008), Innovations for a sustainable future: vision for 2020, 2-4 July 2008, Brisbane.

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