Saving mobilization and its impact on economic growth: a case study on Bangladesh

Rahman, Mohammad Mafizur and Uddin, Mohammad Taslim (2012) Saving mobilization and its impact on economic growth: a case study on Bangladesh. The International Journal of Business and Management Studies, 1 (3). pp. 239-253. ISSN 2158-1479


This paper examines the role of savings in accelerating economic growth in Bangladesh and estimates a simultaneous equation related to this to assess the impact of various factors in determining savings and economic growth in Bangladesh with special emphasis on the impact
of financial sector reforms initiated in the late 1980s. The findings reveal that the growth rate
and real rate of interest have a positive impact on savings rate. Also the dummy variable (financial reform index) has a significant positive effect on savings rate indicating that the financial sector reform has ultimately enhanced savings rate in Bangladesh. Population per branch of scheduled banks, on the other hand, is negatively related to savings rate suggesting that increased availability of branches of banks can stimulate the saving tendency of people. Further, financial savings in turn, foreign direct investment and literacy rate positively affect the growth rate of the economy. Our findings also confirm the saving-growth simultaneity
reflecting that savings and growth positively affect each other and go hand to hand.

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Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Additional Information: Copyright c 2012 by
Faculty/School / Institute/Centre: Historic - Faculty of Business and Law - School of Accounting, Economics and Finance
Date Deposited: 04 Jan 2013 04:44
Last Modified: 10 Nov 2017 04:28
Uncontrolled Keywords: saving mobilization, economic growth, Bangladesh
Fields of Research : 14 Economics > 1402 Applied Economics > 140202 Economic Development and Growth
14 Economics > 1403 Econometrics > 140305 Time-Series Analysis
Socio-Economic Objective: B Economic Development > 91 Economic Framework > 9199 Other Economic Framework > 919999 Economic Framework not elsewhere classified

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