The Relationship Between Financial Development and Economic Growth: New Insights Using Quadruple and Quintuple Helix Innovation Framework and Way Forward

Abdul Rahman () and Muhammad Arshad Khan ()
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Abdul Rahman: COMSATS University
Muhammad Arshad Khan: COMSATS University

Journal of the Knowledge Economy, 2024, vol. 15, issue 2, No 37, 5939-5964

Abstract: Abstract In this study, we showed that the spurts and reversals in GDP growth can be reinvented through consistency in financial and real sector policies along with the strengthening of knowledge democracy, and quality of democracy. To revert the toing and froing situation, this study emphasizes the importance of bringing together quadruple and quintuple helix actors (academia, industry, government, and civil society) to strengthen financial innovations. The quadruple and quintuple helix model forms an integral part of innovation policy, which helps to strengthen finance-growth nexus in developing countries like Pakistan. The present paper suggests that innovations and knowledge democracy are important determinants of finance-growth relationship besides other macroeconomic variables. Despite the importance of the quadruple and quintuple helix model, the model is still far from well-established concept in research and innovation policy in Pakistan. To this end, constructive steps are proposed to espouse the quadruple and quintuple helix innovation model to support government to engage with and facilitate the participation of civil society in discovery process. The policymakers may take necessary steps to strengthen academia-industry-government-civil society relationships, and ensure knowledge democracy and quality of democracy to achieve sustainable growth. The study contributes to the existing literature on innovations through identifying mechanism to foster the quadruple and quintuple helix model.

Keywords: Financial development; Economic growth; Quality of democracy; Quadruple helix innovation framework; Quintuple helix innovation framework; Developing countries (search for similar items in EconPapers)
JEL-codes: C24 F43 O43 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s13132-023-01276-y

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