The impact of bank lending on Palestine economic growth: an econometric analysis of time series data

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dc.contributor.authorAwad, Ibrahim M.
dc.contributor.authorAl Karaki, Mohammed S.
dc.date.accessioned2019-11-11T08:53:15Z
dc.date.available2019-11-11T08:53:15Z
dc.date.issued2019-03-18
dc.description.abstractBanking is an essential sector of Palestine’s economy. More credits provided by banks are considered to have a positive impact on economic growth so that the overall objective of this study is to examine the impact of bank lending on economic growth in Palestine. The study employs the Augmented Dickey-Fuller to test for stationarity in the time series, The Johansen co-integration, Vector Autoregressive Model and Vector Error Correction Model are employed to identify the long-run and short-run dynamics among the variables, and Granger causality test in order to determine the direction of causality. The study finds that a long run relationship exists among the variables and insignificant short run relationship. Also, the study findings show that there is unidirectional causality and runs from GDP to bank lending. The insignificant contribution of bank lending to GDP is attributed to the fact that banks are not highly interested in lending to the production sector of the economy due to the high level of risk. However, the primary empirical evidence reveals that bank lending doesn’t cause economic growth, but economic growth causes bank lending.en_US
dc.description.sponsorshipAcknowledgements We thank our colleagues from Al-Quds University and internationally for assistance and their comments that significantly improved the manuscript. Funding Authors declare that they have no funding for this research.en_US
dc.identifier.citationAwad, I.M. & Al Karaki, M.S. Financ Innov (2019) 5: 14. https://doi.org/10.1186/s40854-019-0130-8en_US
dc.identifier.issn2199-4730
dc.identifier.urihttps://dspace.alquds.edu/handle/20.500.12213/4890
dc.language.isoenen_US
dc.publisherSpringeren_US
dc.subjectEconomic growthen_US
dc.subjectError correction modelen_US
dc.subjectBank lendingen_US
dc.subjectGranger causality testen_US
dc.subjectPalestineen_US
dc.subjectUnit root testsen_US
dc.subjectSolow growth modelen_US
dc.titleThe impact of bank lending on Palestine economic growth: an econometric analysis of time series dataen_US
dc.typeArticleen_US
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