Insurance-growth nexus in Ghana: An autoregressive distributed lag bounds cointegration approach

Abdul Latif Alhassan; Vera Fiador

doi:10.1016/j.rdf.2014.05.003

Insurance-growth nexus in Ghana: An autoregressive distributed lag bounds cointegration approach

Abdul Latif Alhassan
, Vera Fiador

University of Cape Town Graduate School of Business
University of Ghana Business School

Research output: Contribution to journal › Article › peer-review

76 Citations (Scopus)

Abstract

This paper examines the long-run causal relationship between insurance penetration and economic growth in Ghana from 1990 to 2010. Using the autoregressive distributed lag (ARDL) bounds approach to cointegration by Pesaran et al. (1996, 2001), the study finds a long-run positive relationship between insurance penetration and economic growth which implies that funds mobilized from insurance business have a long run impact on economic growth. A unidirectional causality was found to run from aggregate insurance penetration, life and non-life insurance penetration to economic growth to support the 'supply-leading' hypothesis. The findings have implications for insurance market development in Ghana.

Original language	English
Pages (from-to)	83-96
Number of pages	14
Journal	Review of Development Finance
Volume	4
Issue number	2
DOIs	https://doi.org/10.1016/j.rdf.2014.05.003
Publication status	Published - 1 Dec 2014
Externally published	Yes

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 8 Decent Work and Economic Growth

Keywords

ARDL
Africa
Causality
Economic growth
Ghana
Insurance

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10.1016/j.rdf.2014.05.003

Cite this

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title = "Insurance-growth nexus in Ghana: An autoregressive distributed lag bounds cointegration approach",

abstract = "This paper examines the long-run causal relationship between insurance penetration and economic growth in Ghana from 1990 to 2010. Using the autoregressive distributed lag (ARDL) bounds approach to cointegration by Pesaran et al. (1996, 2001), the study finds a long-run positive relationship between insurance penetration and economic growth which implies that funds mobilized from insurance business have a long run impact on economic growth. A unidirectional causality was found to run from aggregate insurance penetration, life and non-life insurance penetration to economic growth to support the 'supply-leading' hypothesis. The findings have implications for insurance market development in Ghana.",

keywords = "ARDL, Africa, Causality, Economic growth, Ghana, Insurance",

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T2 - An autoregressive distributed lag bounds cointegration approach

AU - Alhassan, Abdul Latif

AU - Fiador, Vera

PY - 2014/12/1

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N2 - This paper examines the long-run causal relationship between insurance penetration and economic growth in Ghana from 1990 to 2010. Using the autoregressive distributed lag (ARDL) bounds approach to cointegration by Pesaran et al. (1996, 2001), the study finds a long-run positive relationship between insurance penetration and economic growth which implies that funds mobilized from insurance business have a long run impact on economic growth. A unidirectional causality was found to run from aggregate insurance penetration, life and non-life insurance penetration to economic growth to support the 'supply-leading' hypothesis. The findings have implications for insurance market development in Ghana.

AB - This paper examines the long-run causal relationship between insurance penetration and economic growth in Ghana from 1990 to 2010. Using the autoregressive distributed lag (ARDL) bounds approach to cointegration by Pesaran et al. (1996, 2001), the study finds a long-run positive relationship between insurance penetration and economic growth which implies that funds mobilized from insurance business have a long run impact on economic growth. A unidirectional causality was found to run from aggregate insurance penetration, life and non-life insurance penetration to economic growth to support the 'supply-leading' hypothesis. The findings have implications for insurance market development in Ghana.

KW - ARDL

KW - Africa

KW - Causality

KW - Economic growth

KW - Ghana

KW - Insurance

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SN - 1879-9337

VL - 4

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EP - 96

JO - Review of Development Finance

JF - Review of Development Finance

IS - 2

ER -

Insurance-growth nexus in Ghana: An autoregressive distributed lag bounds cointegration approach

Abstract

UN SDGs

Keywords

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