Individual Presentation or Panel Title

The Interaction of Political Instability, Financial Intermediation, and Economic Growth in a Developing Economy: The Case of Zimbabwe

Abstract

This essay will explore the relationship between financial development and economic growth in the context of a developing country, and the impact political instability may have on this relationship. Zimbabwe was used as a case study for this project. The period that was focused on is the time frame from 1980 until present. When we look at the 1980 until present, we will however discover that there are two distinct periods in the Zimbabwean economy during this timeframe: 1980 until 1997, and 1997 until present. We looked at the 1980 until 1997 period more for historical perspective, and the second period 1997 until present will be basis for analysis. This essay hypothesized that there is a correlation between financial development in a country and its rate of economic growth, provided that the economy is enjoying political stability. The literature for the paper was acquired using mainly electronic sources, and the data for the research was compiled using the World Bank Development Indicators. This data was then modeled into time series graphs to see whether or not a relationship could be established. After analyzing the data, a tentative conclusion was evident that political instability does affect financial development and economic growth.

Presenter Information

Gertrude Siziba, Hollins University

Location

Goodwin Private Dining Room

Start Date

21-4-2012 1:30 PM

End Date

21-4-2012 2:20 PM

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Apr 21st, 1:30 PM Apr 21st, 2:20 PM

The Interaction of Political Instability, Financial Intermediation, and Economic Growth in a Developing Economy: The Case of Zimbabwe

Goodwin Private Dining Room

This essay will explore the relationship between financial development and economic growth in the context of a developing country, and the impact political instability may have on this relationship. Zimbabwe was used as a case study for this project. The period that was focused on is the time frame from 1980 until present. When we look at the 1980 until present, we will however discover that there are two distinct periods in the Zimbabwean economy during this timeframe: 1980 until 1997, and 1997 until present. We looked at the 1980 until 1997 period more for historical perspective, and the second period 1997 until present will be basis for analysis. This essay hypothesized that there is a correlation between financial development in a country and its rate of economic growth, provided that the economy is enjoying political stability. The literature for the paper was acquired using mainly electronic sources, and the data for the research was compiled using the World Bank Development Indicators. This data was then modeled into time series graphs to see whether or not a relationship could be established. After analyzing the data, a tentative conclusion was evident that political instability does affect financial development and economic growth.