Author:
Kyereboah‐Coleman Anthony,Agyire‐Tettey Kwame F.
Abstract
PurposeThe study aims at examining how macroeconomic indicators affect the performance of stock markets by using the Ghana Stock Exchange as a case study.Design/methodology/approachQuarterly time series data covering the period 1991‐2005 were used. Cointegration and the error correction model techniques are employed to ascertain both short‐ and long‐run relationships.FindingsFindings of the study reveal that lending rates from deposit money banks have an adverse effect on stock market performance and particularly serve as major hindrance to business growth in Ghana. Again, while inflation rate is found to have a negative effect on stock market performance, the results indicate that it takes time for this to take effect due to the presence of a lag period; and that investors benefit from exchange‐rate losses as a result of domestic currency depreciation.Originality/valueThe single most important contribution of this study is its emphasis on macroeconomic variables and stock market performance in a small country, since most studies have concentrated on stock markets and economic growth in advanced economies.
Reference39 articles.
1. Agenor, P.R. (2000), The Economics of Adjustment and Growth, Academic Press, New York, NY.
2. Aidoo, J.E. (1989), “Report on the feasibility of a stock exchange in Ghana” (unpublished).
3. Arowolo, E.A. (1971), “The development of capital markets in Africa with particular reference to Kenya and Nigeria”, International Monetary Fund Staff Papers, Vol. 18 No. 2, pp. 420‐76.
4. Atje, R. and Jovanovic, B. (1993), “Stock markets and development”, European Economic Review, Vol. 37, pp. 632‐40.
5. Bhatt, V.V. (1988), “On financial innovations and credit markets evolution”, World Development, Vol. 16 No. 2, pp. 281‐92.
Cited by
58 articles.
订阅此论文施引文献
订阅此论文施引文献，注册后可以免费订阅5篇论文的施引文献，订阅后可以查看论文全部施引文献