The Contribution of Commercial Banks to Economic Growth of Ethiopia
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Date
2018-05
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Abstract
The research investigates the contribution of Commercial Banks to economic growth of Ethiopia, the study uses the data of commercial banks in Ethiopia from 2001-2017, the study conducted with time series data using Eviews 9. The dependent variable is RGDP and the independent variables are four (DEPOSIT, PROFIT, LOAN AND TOTAL ASSET) return on asset is as a proxy for profit and total asset is taken as a proxy for size
To test the model ADF test for stationary, LM test for Serial correlation ,Bruechpegan test for hetrosekedascity ,Jargue Bera test for normality and Granger causality test for causality finally I am using two stage OLS regression model .The variables are become stationery at second difference. All variables are free from serial correlation, heterosekedascity and normally distributed. The Granger causality test has shown that there is bi directional cause means all the independent variables influence the dependent variable in one direction and on the regression I have found that all variables affect the economic growth significantly but the three variables loan, asset and deposit contribute positively to RGDP, profit by proxy of ROA is negatively affect the growth .
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A thesis Submitted to the Addis Ababa University, College of Business and Economics in Partial Fulfillment of the requirement for the Degree of Masters of Business Administration in Financial Service
Keywords
Commercial Banks, Economic Growth, Ethiopia