Financial Deepening in Ghana; Does Macroeconomics Matter

Samuel Erasmus Alnaa¹ , Juabin Matey²

Section:Research Paper, Product Type: Journal-Paper
Vol.10 , Issue.4 , pp.39-46, Apr-2024

Online published on Apr 30, 2024

Copyright © Samuel Erasmus Alnaa, Juabin Matey . This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
 

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Abstract :
Financial deepening plays a pivotal role in fostering economic growth, alleviating poverty, and mitigating social inequalities. Employing the Vector Autoregressive Model (VAR), this study examines the implications of per capita gross domestic product (GDP), interest rates, and inflation rates for financial deepening (FD) in Ghana. GDP per capita and interest rates exhibit statistically significant impacts on FD in Ghana. The statistically significant influence of GDP per capita and interest rates underscores their significance as robust favourable determinants of financial sector development in Ghana. Hence, policymakers are entreated to closely monitor the behaviour of these macroeconomic variables that positively influence financial deepening, as they play crucial roles in fostering economic growth.

Key-Words / Index Term :
Financial Deepening, GDP per capita, Economic Growth, Interest Rate, Inflation, VAR

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