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    Presentation For M. Phil. Proposal

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    Rituraj Bhat

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    Presentation For M. Phil. Proposal

    Uploaded by

    Rituraj Bhat
    3 views22 pages

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    Presentation for m. Phil. Proposal

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    3 views22 pages

    Presentation For M. Phil. Proposal

    Uploaded by

    Rituraj Bhat

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 22

    Presentation on the topic

    “Financial development and


    economic growth: Evidence from
    Nepal”

    PRESENTER: RITU RAJ BHATT, M.PHIL. SCHOLAR


    FACULTY OF MANAGEMENT, FWU
    Introduction……….

     The finance-growth relationship has been extensively


    studied in the literature, and the majority of the data
    points to the pr
     Economic growth is considerably impacted by financial
    development.
     Better resource allocation results from increased financial
    sector efficiency, which promotes economic expansion.
    Contd…..

     Though there has been a significant increase in study on


    the relationship between finance and growth for
    Nepalese economy.
     thereis a dearth of empirical evidence using the new
    financial indices that Svirydzenka (2016) proposed as
    proxies of financial development to examine the finance-
    growth relationship
     In order to stabilize the economy, this involved increasing
    spending on financial sector development which include
    financial institutions and financial markets.
    Statement of the problem

     Over the past few decades, study of the finance-growth


    nexus has been emerged as the main concerns of the
    researchers.
    .In the body of current literature, there is ample evidence
    of a relationship between financial development and
    economic growth basically in American, European and
    developed Asian countries.
    Contd……

     Although these conclusions apply to industrialized


    nations, developing nations like Nepal do not have access
    to such empirical data. It raises more questions, such as
    whether these conclusions would hold true in the context
    of the Nepalese economy.
    Research Questions

    a. How does financial market index effect on economic growth?

    b. How does financial institution development index effect on economic growth?

    c. How does financial development index effect on economic growth?

    d. How do macroeconomic variables (Inflation, FDI, Trade Openness), effect on

    financial development index and GDP?


    Objectives

    a. To examine the impact of financial market index on economic growth.

    b. To examine the impact of financial institution index on economic growth.

    c. To examine the impact of development index on economic growth.

    d. To examine the impact of macroeconomic variables (inflation, FDI, Trade openness)


    Conceptual Framework Dependent Variables
    (Economic Growth)
    Independent Variables Control Variables
    (Financial Development) (Macro-Economic
    Factors)

    Financial Development
    Index
    Financial Institutions
    Index
    Financial Institutions
    Access Index
    GDP
    Financial Institutions
    Efficiency Index
    Financial Institutions
    Depth Index
    Inflation
    Financial Markets Index
    Foreign Direct Investment
    Financial markets access
    Trade Openness
    Index
    Quality of Fiscal policy
    Financial Markets
    Efficiency Index
    Financial Markets Depth
    Index
    Research Methodology

     Descriptive and casual comparative research design will be


    used in order to address the basic problems related to
    economic growth determinants in the Nepalese context. This
    study will use a variety of statistical and econometric tools,
    including correlation matrices, time trend analyses, multiple
    regression analyses, and panel data analyses, to analyze data
    from Nepal, totaling 20 observations for each variable from
    the fiscal years 2002–2003 to 2021–2022.
     Nature and sources of data: secondary data from website
    of world bank and IMF
     Descriptive statistics
     Inthis section a short descriptive statistic of the variable
    will be calculated which includes mean, standard
    deviation minimum and maximum values.
     Correlation analysis: To determine the direction and the relationship among the
    variables, correlation analysis will be conducted.
     . Econometrics Models


    To examine the impact of financial development index on economic growth, this study will

    use multiple regression model. In addition, the impact of macro-economic factor on

    independent variables and dependent variables will be analyzed by using regression analysis.


    Following is the regression model for the study:
    Econometrics Models

    FDi = β1+ β2INFi + β3FODIi + β4OPENi + Ɛi

    GDPi = β1+ β2INFi + β3FODIi + β4OPENi +Ɛi

    GDPi = β1 + β2FIIi + β3FMIi + Ɛi


    Definition of variables

     1. Financial Development
     The Financial Development (FD) is a independent
    variable which comprises three financial development
    indices derived from the IMF Financial Development
    Index data base, which was proposed by Svirydzenka
    (2016).
     2. Financial Development Index:
    Contd…….

     Financial development index is the aggregate of financial


    institutions index and financial market index. It is a
    relative ranking of country on depth, access and
    efficiency of its financial institutions and financial
    markets.
     3. Financial institutions index (FII)
     Financial institution index is the ranking of country on the depth,
    access and efficiency of its financial institutions.
     4. Financial institutions depth index (FID)
     Data on bank loans to the private sector as a percentage of GDP,
    pension fund assets to GDP, mutual fund assets to GDP, and
    insurance premiums—both life and non-life—to GDP are
    compiled by the Financial Institutions Depth Index
    Contd…..

     5. Financial institutions access index (FIA)


     The Financial Institutions Access Index gathers information on
    the number of ATMs and bank branches per 100,000 adults.
     6. Financial institutions efficiency index (FIE)
     Data on the net interest margin, lending deposit spread, non-
    interest revenue to total income, overhead costs to total assets,
    return on equity, and return on assets are compiled by FIE for the
    banking sector.
    Contd….

     7. Financial market index (FMI)


     The sum of the financial market efficiency, depth, and access indices is
    known as the financial market index.
     8. Financial market depth index (FMD)
     The Financial Market Depth Index gathers information on the
    relationship between GDP and stock market capitalization, GDP and
    stock trades, GDP and foreign government debt securities, and GDP
    and total debt securities of financial and non-financial firms.
    Contd…..

     9. Financial market access index (FIA)


     The Financial Market Access Index gathers information
    on the percentage of market capitalization that is not
    among the top ten largest companies as well as the total
    number of domestic and foreign, non-financial and
    financial corporations that issue debt per 100,000 adults.
    Contd…..

     10. Financial markets efficiency index (FME)


     The financial markets efficiency index gathers
    information on the ratio of stock transactions to
    capitalization.
     11.
    Base article

     Asteriou, D., Spanos, K., &Trachanas, E. (2024).


    Financial development, economic growth and the role of
    fiscal policy during normal and stress times: Evidence for
    26 EUcountries. International Journal of Finance &
    Economics, 29(2), 2495–2514. https://doi.org/10.
    1002/ijfe.2793
    Thank You

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