The study of relationship between financial liberalization and economic growth at Middle East and South Africa

Subject Areas : Applied Economics

مریم خوشنویس ¹ , اعظم احمدیان ² , فاطمه مهربانی ³

1 - مسئول مکاتبات
2 - ندارد
3 - ندارد

Received: 2009-08-24 Accepted : 2010-05-12 Published : 2010-06-22

Keywords: financial liberalization, Economic growth, foreign direct investment, Portfolio Investment Assets, Panel Data Method,

Abstract :

This paper aims to delineate the dynamics of financial liberalization and economic growth in mena region (Middle East and North Africa) based on data entailing the period of 1996-2007, using group pooled technique. In doing so, the technique has employed some potential and actual indicators of financial liberalization to measure the impact on economic growth of financial liberalization, for example, the flow of foreign direct investment has been used as a proxy for actual financial liberalization index. As such the paper has investigated the casual relation between economic growth and financial development on one hand and that of financial development and financial liberalization on the other hand. The result indicate that in the former case one way relation exist i.e. economic growth exert its impact on financial development but in the latter case no casual relationship has not been noticed. Moreover, it has been found that economic liberalization has rendered a positive impact on economic growth