Interest Rate Reforms and Economic Growth in SADC Countries:The Savings and Investment Channel

Scientific Annals of Economics and Business

Clement Moyo¹  Pierre Le Roux¹ 

[1] Nelson Mandela University;

关键词: interest rate reforms;    economic growth;    sadc;    savings;    investments;    pmg.;   

DOI  :  10.2478/saeb-2019-0039

来源: DOAJ

【 摘 要 】

The 2008/2009 global financial crisis has re-ignited the debate around financial reforms with contrasting views with regards to the impact of financial reforms on economic growth. This study examines the impact of interest rate reforms on economic growth through savings and investments in SADC countries for the period 1990-2015. Three specifications are used for the analysis; the first one determines the influence of interest rate reforms on savings, the second one analyses the effect of savings on investments while the third one examines whether investments have a positive impact on economic growth. The Pooled Mean Group (PMG) estimation technique is employed for analysis. The results show that interest rate reforms have a positive impact on economic growth through savings and investments. The study therefore recommends that market forces should be allowed to determine real interest rates and furthermore, real interest rates maintained at artificially low levels may harm economic growth.

【 授权许可】

Unknown