<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>The main objective of this paper is to discuss and examine the relationship between the development of stock market and economic growth and to show if the economic growth is positively influenced by stock market development in Singapore. Theoretically, some economists postulate a bidirectional relationship between financial development and economic growth, while others consider that growth drives finance, but that financial development is only a minor growth factor. We used an econometric study based on an autoregressive distribution lag (ARDL) model covering the period from 1990 to 2020 which is supported by the Asian financial crisis of 1997, obtained from various sources, in particular World Bank data and International Monetary Fund reports. Economic growth is expressed by GDP per capita, while stock market development is measured by market capitalization of domestic listed companies (% of GDP), shares traded total value (% of GDP) and stocks traded turnover ratio of domestic shares (%). The results show that the capitalization of domestic listed companies and the turnover ratio of domestic stocks have a positive and significant effect on gross domestic product per capita in the short and long run. However, shares traded total value hasa negative impact on gross domestic product per capita in short and long term. The contribution of our results suggests that stock market development promotes short and long-run growth in Singapore. Our findings can be of direct value to developed or emerging countries while they are of indirect value to less developed economies that may be committed to certain policy or regulatory decisions,</p>
</abstract>

The main objective of this paper is to discuss and examine the relationship between the development of stock market and economic growth and to show if the economic growth is positively influenced by stock market development in Singapore. Theoretically, some economists postulate a bidirectional relationship between financial development and economic growth, while others consider that growth drives finance, but that financial development is only a minor growth factor. We used an econometric study based on an autoregressive distribution lag (ARDL) model covering the period from 1990 to 2020 which is supported by the Asian financial crisis of 1997, obtained from various sources, in particular World Bank data and International Monetary Fund reports. Economic growth is expressed by GDP per capita, while stock market development is measured by market capitalization of domestic listed companies (% of GDP), shares traded total value (% of GDP) and stocks traded turnover ratio of domestic shares (%). The results show that the capitalization of domestic listed companies and the turnover ratio of domestic stocks have a positive and significant effect on gross domestic product per capita in the short and long run. However, shares traded total value hasa negative impact on gross domestic product per capita in short and long term. The contribution of our results suggests that stock market development promotes short and long-run growth in Singapore. Our findings can be of direct value to developed or emerging countries while they are of indirect value to less developed economies that may be committed to certain policy or regulatory decisions,

The Impact of Stockmarket Development on Economic Growth in Singapore. Econometric Study Based on an Autoregressive Distribution Lag (Ardl) Model Covering the Period From 1990 to 2020

Lecturer, Faculty of Economics Commercial and Management Sciences, Department of Economics

Professor, Faculty of Economics Commercial and Management Sciences, Department of Economics

Financial Markets, Institutions and Risks (FMIR)

This work is licensed under the Creative Commons Attribution 4.0 International License.

The main objective of this paper is to discuss and examine the relationship between the development of stock market and economic growth and to show if the...

The Impact of Stockmarket Development on Economic Growth in Singapore. Econometric Study Based on an Autoregressive Distribution Lag (Ardl) Model Covering the Period From 1990 to 2020

Published Online: Oct 29, 2022

Page range: 49 - 63

Received: Jun 17, 2022

Accepted: Aug 20, 2022

DOI: https://doi.org/10.21272/fmir.63.49-63.2022

Keywords
Economic growth, Stock market development, financial indicators, ARDL model, Singapore

© 2022 Djamila Bekhti et al., published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

The Impact of Stockmarket Development on Economic Growth in Singapore. Econometric Study Based on an Autoregressive Distribution Lag (Ardl) Model Covering the Period From 1990 to 2020

Published Online: Oct 29, 2022

Page range: 49 - 63

Received: Jun 17, 2022

Accepted: Aug 20, 2022

DOI: https://doi.org/10.21272/fmir.63.49-63.2022

KeywordsEconomic growth, Stock market development, financial indicators, ARDL model, Singapore

© 2022 Djamila Bekhti et al., published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Keywords
Economic growth, Stock market development, financial indicators, ARDL model, Singapore