The macroeconomic drivers of stock market development: Evidence from Hong Kong

Sin-Yu Ho and Nicholas Odhiambo

No 23438, Working Papers from University of South Africa, Department of Economics

Abstract: This paper examines the macroeconomic drivers of stock market development in Hong Kong during the period 1992Q4 to 2016Q3. Specifically, it investigates the impact of banking sector development, economic growth, the inflation rate, the exchange rate, trade openness and stock market liquidity on stock market development. By employing autoregressive distributed lag (ARDL) bounds testing procedure, we find that banking sector development and economic growth have positive impacts on stock market development, whereas the inflation rate and the exchange rate have negative impacts on stock market development both in the long and short run. In addition, the results show that trade openness has a positive long-run impact but a negative short-run impact on stock market development. Policy recommendations are provided based on these findings.

Keywords: macroeconomic drivers; determinants; stock market development; Hong Kong; ARDL bounds testing (search for similar items in EconPapers)
Date: 2017-11
New Economics Papers: this item is included in nep-fdg and nep-mac
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://uir.unisa.ac.za/bitstream/handle/10500/2343 ... om%20Hong%20Kong.pdf (application/pdf)

Related works:
Journal Article: The macroeconomic drivers of stock market development: evidence from Hong Kong (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:uza:wpaper:23438

Access Statistics for this paper

More papers in Working Papers from University of South Africa, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Shaun Donovan ().