A Research Journal of Commerce, Economics, and Social Sciences
Online ISSN: 2410-0854
Print ISSN: 1996-2800

Paradigms Journal

Better tool for economic growth Banks or secondary markets Empirical evidence from selected ASIAN countries
Author(s) :
Aamir Azeem (Department of Management Sciences, Virtual University of Pakistan)
Dr. Bilal Aziz (Department of Management Sciences, GC University, Faisalabad )
Atif Khan Jadoon (Department of Economic, University of Punjab, Lahore)
Economic growth is the most desirous goal of any country and this article attempts to capture the impact of banking sector and secondary market on economic growth. Financial development has been categorized into bank based and secondary market based. In this model, seven high growing countries have been taken from Asian countries. A rare research technique, Panel SUR, has been adopted owing to hetroscadastidy and cross country correlation in the long panel. Finding shows that stock market liquidity is not significant in the panel whereas banking credit to private sector to specific country is negatively related with economic growth. Financial depth, foreign direct investment, stock market quantum and stock market efficiency have positive relationship with economic growth in the panel. Secondary market variables have more impact in contrast to bank based variables in the panel. Most influential country is China while least one is Bangladesh in the panel .Policymakers should focus especially on increasing financial depth, enhancing secondary market activities by introducing more stock markets, increasing foreign direct investment inflows and improving stock markets’ liquidity to uplift economic growth in the countries. 
Keywords: Financial depth, economic growth, secondary markets, SUR, GDP

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