Published : 2019-12-20

Growth effects of financıal market instruments: the Ghanaian experience


This study analyses the growth effects of financial market instruments in Ghana between 1991 and 2017. We use the Autoregressive Distributed Lags (ARDL) bounds testing approach to analyse data on real GDP per capita, monetary policy rate, treasury bill rate, stocks traded, bank credits, stock turnover, market capitalisation, foreign direct investment, and gross investment. The findings show the existence of a long-term relationship between both short- and long-term financial market indicators and economic growth. Also, the results confirm that long-term financial instruments perform better than short-term instruments in boosting the country’s economy in the short run, while in the long run, both short-term and long-term financial indicators positively impact economic growth in Ghana. We recommend that the Bank of Ghana should consider lowering the bank rate further from the current annual rate of 16.0% to enhance bank credits, boost domestic investment, and improve growth in the long run.


Financial market instruments, market capitalisation, economic growth, ARDL bounds test, Ghana





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Mesagan, E. P. ., Ogbuji, I. A. ., Alimi , Y. O. ., & Odeleye, A. T. . (2019). Growth effects of financıal market instruments: the Ghanaian experience. Forum Scientiae Oeconomia, 7(4), 67–82.

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