Financial structure and economic growth: the case of Vietnam

Abstract

This paper investigates the role of financial structure in promoting economic growth in Vietnam using a number of econometric techniques. The results indicate that there is no strong relationship between stock market development and economic growth. In particular, the Granger causality tests suggest no causal effects between these variables. The impulse response tests and the variance decomposition analysis present evidence of the one-way impact from the stock market capitalization variable on the change of economic growth, however, this effect is marginal.