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THE LINKAGE BETWEEN STOCK PRICE AND ECONOMIC GROWTH IN AUSTRALIA: A CHICKEN-AND-EGG PARADOX?
Chor Foon Tang
Sažetak
This study attempts to re-investigate the linkage between stock prices and economic growth in Australia using the cointegration and Granger causality tests. The study covers the quarterly data from 1960:Q1 to 2008:Q4. The cointegration test exhibits that the variables are cointegrated, implying that stock prices and economic growth in Australia are moving together in the long-run. Nevertheless, the TYDL causality test suggests that there is only a unidirectional causality running from stock prices to economic growth. Moreover, the recursive regression-based TYDL causality test affirms that this unidirectional causality is stable over their respective period of analysis. Therefore, the relationship between stock prices and economic growth in Australia is no longer a chicken-and-egg paradox.
Ključne riječi
Australia; Economic Growth; Stock Price; Recursive Causality Test
Hrčak ID:
104028
URI
Datum izdavanja:
1.6.2013.
Posjeta: 2.091 *