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The Effect of the Knowledge-Based Economy on the Development of Financial Markets:
Panel Cointegration Technique with ARDL Approach
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Abstract: (5183 Views) |
Development of financial markets and its influential factors has been one of the main concerns for economists, especially in the recent decades. Since in the knowledge-based economy, production, distribution, and use of knowledge and information are the principal drivers of development, wealth creation and employment in all economic activities, examining the effect of the knowledge-based economy indicators in the development process of the financial market is very crucial. In this paper, the effect of knowledge-based economy indicators (education expenditures, spending on ICT, research and development expenditure, the experts in research and development, registered patents and innovations, exports of high-tech and quality of regulations) on the development of financial markets is examined for the 9 developing countries (in particular, Iran) during the period 2002 to 2014. A panel cointegration technique with the approach of Autoregressive Distributed Lag (ARDL) is employed to estimate the effect of the variables. The results suggest that the impact of the knowledge-based economy indicators on the stock market (the value of shares traded on the stock market on GDP) and the money market (credit provided by the banking system) is positive. |
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| Keywords: Knowledge based Economy, financial markets, Panel Cointegration Technique. |
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Full-Text [PDF 1097 kb]
(1921 Downloads)
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Type of Study: Research |
Subject:
Special
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