The purpose of this paper is to analyze the impact of capital market development on economic growth in MENA region (Egypt, Tunisia, Saudi Arabia and Kuwait) for the period of 2002 to 2014. Pooled Ordinary least square (OLS) regression for static panel data has been utilized in this study to test how selected countries that represent two different categories (oil exporters and non-oil exporters) would achieve higher economic growth rates as a group through pooling their capital markets. The results reveal that the 60% of indicators of capital markets development (number of Shares traded, Number of transactions, General index) in these economies together have significant impact on economic growth. Furthermore, the result proves that number of Shares traded, and General index have significant positive effect on economic growth, while Number of transactions has significant negative effect on economic growth. Finally, these outcomes recommend that Capital market development variables can used to reach the purposed growth for these economies. In the case of Control variables, the pooled model analyzed them beside the other variables. Among all the control variables (including GDP per capita, Investment, saving, inflation, exchange rate, and interest rate), just the saving variable has a positive significant effect on the economic growth. Based on the coefficient of the saving in the model is 0.0543297 and at level of 5%. seem to be statistically significant in explaining the changes in GDP. Hence, it is recommended that capital market development variables can be used to reach the growth for the economies of MENA region.

Username
Password