RIS ID
24914
Abstract
This study investigates the causal relationship between financial development and economic growth in Sri Lanka over the period 1955 to 2005. After considering the time series characteristics of six measures of financial development, Johansen cointegration and the appropriate Error Correction Model are used to investigate the causal relationship between financial development and economic growth. The findings suggest that broad money causes economic growth with two-way causality. The major finding of this study does not strongly support the view that financial development boosts economic growth.
Publication Details
Perera, N. & Paudel, R. (2009). Financial development and economic growth in Sri Lanka. Applied Econometrics and International Development, 9 (1), 157-164.