SECURITIES MARKET DEVELOPMENT AND ECONOMIC GROWTH IN THE COMMON MARKET FOR EASTERN AND SOUTHERN AFRICA MEMBER STATES

Abstract

Abstract

Purpose: The purpose of this paper is to investigate the effect of securities markets development on the economic growth of the Common Markets for Eastern and Southern Africa (COMESA) member states.

Design/Methodology: The study was structured as a longitudinal study using a causal research design focusing on the study period from 2005 to 2020. The study subjected panel data from nine (9) COMESA member states to pooled OLS as our estimator.

Findings: The study findings show that securities market development positively influenced the economic growth of COMESA member states. The study conclude that securities markets development is a strong macroeconomic factor that can be used by the member states to directly determine the level of economic growth.

Originality/Value: The study contributes to knowledge in providing evidence on the influence of securities markets development on the economic growth of COMESA member states considering that there is limited empirical evidence in the finance literature in this area.

Implication to Policy: The study recommends that COMESA member states should put more focus and measures in place aimed at making the securities market more efficient and attractive to investors to augment economic growth within the trading bloc.

Key Words: Securities Market Development, Economic Growth, and Pooled OLS.