The link between financial development and knowledge-based economy - Evidence from emerging markets

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1 Citation (Scopus)

Abstract

This paper examines the role of financial development in shaping knowledge-based economy in emerging countries using panel data approach from 1995 to 2011. On overall financial development, we find that larger financial sector and financial system that is more bank-based are associated with higher knowledge economy status. On banking development, our results show that a well-developed banking sector contributes positively to a country’s standing in the knowledge economy index. Interestingly, we find no evidence that stock market influences the state of knowledge economy. The findings suggest that bank-based financial system is the key financial structure that best supports knowledge-based development in emerging countries.

Original languageEnglish
Pages (from-to)51-88
Number of pages38
JournalJournal of Economic Cooperation and Development
Volume36
Issue number1
Publication statusPublished - 2015

Fingerprint

knowledge economy
economy
financial system
market
banking
knowledge
evidence
bank
stock market
Financial development
Knowledge-based economy
Financial knowledge
Emerging markets
Knowledge economy
Emerging countries
Financial system
Financial structure
Financial sector
Knowledge-based
Banking sector

ASJC Scopus subject areas

  • Business and International Management
  • Economics and Econometrics
  • Political Science and International Relations

Cite this

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title = "The link between financial development and knowledge-based economy - Evidence from emerging markets",
abstract = "This paper examines the role of financial development in shaping knowledge-based economy in emerging countries using panel data approach from 1995 to 2011. On overall financial development, we find that larger financial sector and financial system that is more bank-based are associated with higher knowledge economy status. On banking development, our results show that a well-developed banking sector contributes positively to a country’s standing in the knowledge economy index. Interestingly, we find no evidence that stock market influences the state of knowledge economy. The findings suggest that bank-based financial system is the key financial structure that best supports knowledge-based development in emerging countries.",
author = "Low, {Soo Wah} and Tee, {Lain Tze} and Kew, {Si Roei} and Ghazali, {Noor Azlan}",
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