Role of equity and corporate bond financing in US economic growth

Prashanta K. Banerjee and Matiur Rahman

International Journal of Trade and Global Markets, 2011, vol. 4, issue 1, 13-24

Abstract: This paper re-examines the role of equity and corporate bond financing in spurring US economic growth. Annual data from 1960 through 2008 are utilised. The variables in levels are non-stationary with different orders of integration. Thus, the Autoregressive Distributed Lag (ARDL) procedure is applied for cointegration. The estimates of the Vector Error-Correction Model (VECM) unveil a robust long-run causal flow from the dual channels of financing to US economic growth. The short-run interactive effects are weakly positive.

Keywords: equity; corporate bond financing; cointegration; USA; United States; economic growth. (search for similar items in EconPapers)
Date: 2011
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Persistent link: https://EconPapers.repec.org/RePEc:ids:ijtrgm:v:4:y:2011:i:1:p:13-24

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