000 02300nam a2200217 4500
999 _c50968
_d50968
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100 _aAhad, Muhammad
_97909
245 _aA Dynamic Relationship between Financial Development and Import Demand for Bangladesh: An Evidence from Combine Cointegration and Granger Causality Approach
300 _a543–555 p.
520 _aThis article has estimated the impact of financial development on import demand over the period of 1986: Q1–2014: Q4 in case of Bangladesh. The long-run relationship between financial development, import demand and economic growth are investigated by combine cointegration. Error Correction Method (ECM) is applied to examine short-run phenomena. The unit root properties of variables are tested by augmented Dickey–Fuller test (ADF) and Philips–Perron (P–P) unit root test. Perron (1997) single structural break unit root test is also applied. The results of Bayer and Hanck (2013) combine cointegration test that reveal the existence of long-run relationship between import demand, financial development and economic growth. Financial development and economic growth have a positive and significant impact on import demand in long run as well as in short run. The lagged value of error correction method (ECMt-1) is –0.08 that is negative and significant. This indicates that change from equilibrium level of import demand is corrected by 8 per cent per quarter in a year. The results of Vector Error Correction Model (VECM) Granger causality explain that bidirectional causality exists between import demand and financial development in long run as well as short run. Similarly, bidirectional causality exists between import demand and economic growth in short run. Policymakers should focus on financial sector development for import of technology through adoption of the import substitution policy.
653 _aFinancial development,
653 _aimport demand,
653 _acombine cointegration,
653 _aVECM Granger causality,
653 _aBangladesh
700 _aDar, Adeel Ahmad
_932946
773 0 _029349
_970966
_aBANIK, ARINDAM
_dNEW DELHI SAGE PUBLISHING PVT. LTD.
_o5558944
_tGLOBAL BUSINESS REVIEW
_x0972-1509
942 _2ddc
_cJA-ARTICLE