MODERATOR EFFECT OF TECHNOLOGICAL ADVANCEMENT ON FINANCIAL DEVELOPMENT AND ECONOMIC GROWTH NEXUS IN ASIAN COUNTRIES

Authors

DOI:

https://doi.org/10.32890/jis2024.20.1.5

Keywords:

Financial development, technological advancements, economic growth, short panel data analysis

Abstract

The examination of the nexus between Financial Development (FD), Technological Advancement (TA), Human Capital (HC), and
Private Consumption (PC) to Economic Growth (EG) has gained substantial attention in both empirical and theoretical academia since
the early nineteenth century. Scholars affirm that FD, HC, PC, and TA are crucial factors in determining optimal resource allocation
and efficient utilization required to achieve sustainable EG. This study investigates the nexus of FD, HC, and PC with EG in Asian
countries, with TA serving as the moderator. Data from 35 countries were collected annually over 15 years, spanning from 2005 to 2019. Using short panel data analysis, due to the higher number of crosssections (35) compared to time intervals (15), the findings confirm TA’s significant moderator effect in both short and long-run time scenarios. Additionally, a significant negative relationship with EG is observed for FD and PC, while TA and HC are identified as promoters of EG. The study underscores the importance of investing in TA while concurrently developing the quality of the labor force. Policymakers are encouraged to prioritize technology development and the introduction of innovative techniques. However, caution is advised in FD projects, necessitating strategies to reduce domestic private consumption.

Author Biographies

Rishan Sampath Hewage, Faculty of Management Studies Sabaragamuwa University of Sri Lanka, Sri Lanka

Mr. Rishan Sampath Hewage is a Senior Lecturer in the Department of Accountancy and Finance, Faculty of Management Studies, Sabaragamuwa University of Sri Lanka, Belihul Oya, Sri Lanka. He got his bachelor’s degree from the Sabaragamuwa University of Sri Lankan in Financial Management. Further, a Master’s degree from the University of Sri Jayewardeneura. Currently, he is reading for his Ph.D. at the Faculty of Business and Management Universiti Teknologi Mara (UiTM). He can be contanced at the Department of Accountancy and Finance, Faculty of Management Studies, Sabaragamuwa University of Sri Lanka, Belihuloya 70140, Sri Lanka.

Norashida Othman, Faculty of Business and Management, Universiti Teknologi MARA Shah Alam, Malaysia

Dr. Norashida Othman is a senior lecturer from Universiti Teknologi MARA, Puncak Alam campus. She pursued her Degree in Economics at Universiti Kebangsaan Malaysia and then continued her Master Degree, specializing in Economics Development at Universiti Kebangsaan Malaysia. She received the scholarship to pursue her PhD in International Economics at Universiti Putra Malaysia. She has a very deep interest in research and actively involved in various research grants as well as consulting projects. Among its past consultancy project agencies include the Malaysian Construction Industry Development Board (CIDB), Institut Darul Ridzuan (IDR), the East Coast Economic Region Development Council (ECER), the Subang Jaya City Council (MPSJ) and Majlis Pembangunan Bumiputera, Pulau Pinang.

Additional Files

Published

12-05-2024

How to Cite

Hewage, R. ., Pyeman, J., & Othman, N. (2024). MODERATOR EFFECT OF TECHNOLOGICAL ADVANCEMENT ON FINANCIAL DEVELOPMENT AND ECONOMIC GROWTH NEXUS IN ASIAN COUNTRIES. Journal of International Studies, 20(1), 115–147. https://doi.org/10.32890/jis2024.20.1.5