Question of causality between financial development and economic growth: The case of Algeria (1980-2017)
Abstract
In this article, we examine empirically the causal relationship between financial development and economic growth in Algeria during the period 1980-2017 via the error correction model. More precisely, the article aims to determine whether financial development causes Granger’s economic development in Algeria or vice versa. The empirical results of the study show that the financial sector has a positive effect on long-term economic growth. In addition, there is a unidirectional causal link from the financial sphere to the real sphere.
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References
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