The Role of Financial Instruments in Economic Development of Mediterranean Countries
International Review of Applied Financial Issues and Economics 3 (3) 2011; 504-512.
Posted: 8 Dec 2012
Date Written: December 7, 2011
Abstract
The role of financial instruments in enhancing economic growth is considered one of the most debatable issues in both developing as well as emerging economies. Thus, this study comes to investigate this issue in the Mediterranean context considering a sample of both the south and north Mediterranean region, which have close financial merits. The four selected as a sample included Turkey, Greece, Egypt and Jordan have moderate financial markets with low liquidity and turnover, highly concentrated ownership, with limited types of traded financial instruments. The study found that the association between financial instruments and economic growth is relatively higher in the South sample compared to the economy of the Northern sample and it is relatively more correlated to the GDP rather than to the GFCF, with the exception of the stock market capitalization. Finally, the study concluded that the major merits of associations between financial instruments and economic growth measures as expressed by GDP and GFCF in both regions of the Mediterranean as expressed by the sample are close with little exception.
Keywords: financial instruments, economic development, Mediterranean countries
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