Development of stock market and economic growth: the G-20 evidence

The paper examines the long-run relationship between development of stock market and economic growth in G-20 countries for the period 1980–2015. Using vector auto-regressive model for testing the Granger causalities, the study finds the presence of both unidirectional and bidirectional causality between development of stock market and per capita economic growth. The policy implication of this study is that the economic policies should recognize the differences in the development of stock market and per capita economic growth in order to maintain sustainable development in the G-20 countries. © 2018, Eurasia Business and Economics Society.