Do the Macroeconomic Forces Affect Stock Market Development? An Empirical Investigation from G-10 Economies

Authors

Sajjad Hussain(1) Sajjad Hussain Affiliation M. Phil Scholar, National College of Business Administration & Economics (sub campus Multan), Pakistan Other articles by this author , Abdullah Bin Omar(2) Abdullah Bin Omar Corresponding author Affiliation Assistant Professor, Department of Business Administration, National College of Business Administration & Economics (NCBA&E) Lahore, (Sub-campus Multan), Pakistan Email addressabo776@gmail.com Other articles by this author , Muhammad Samar Abbas(3) Muhammad Samar Abbas Affiliation PhD Economics Scholar, School of Economics, Bahauddin Zakariya University, Multan, Pakistan Other articles by this author , Muhammad Sibt e Ali(4) Muhammad Sibt e Ali Affiliation PhD Economics Scholar, Business School Zhengzhou University Henan China Other articles by this author

  1. M. Phil Scholar, National College of Business Administration & Economics (sub campus Multan), Pakistan
  2. Assistant Professor, Department of Business Administration, National College of Business Administration & Economics (NCBA&E) Lahore, (Sub-campus Multan), Pakistan
  3. PhD Economics Scholar, School of Economics, Bahauddin Zakariya University, Multan, Pakistan
  4. PhD Economics Scholar, Business School Zhengzhou University Henan China

https://doi.org/10.36923/jcmi.v4i1.543

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Abstract

The theoretical and empirical literature has demonstrated the critical and significant role of the stock market in developing the economy. The relationship between stock market development (SMD) and macroeconomic variables is examined in the current study using panel data of the top 10 developed countries from 2000 to 2019. The data have been tested using the panel ARDL approach. This study discovered a significant relationship between gross domestic product, Inflation rate, banking sector development, and stock market liquidity and the stock market development. While foreign direct investment has an insignificant relationship with stock market development. The gross domestic product, banking sector development, and foreign direct investment have a positive impact on the stock market development while the inflation rate and stock market liquidity have a negative impact on the stock market development of the G-10 economies. The study has some important practical implications.

Article information

Keywords
Stock market developmentmacroeconomic factorsPanel ARDLG-10 economies
Section
Articles
Issue
Vol. 4 No. 1 (2023)
Submitted
May 21, 2023
Accepted
June 2, 2023
Published
June 2, 2023
Corresponding author
Abdullah Bin Omar
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