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Inventi Impact - Emerging Economies

Articles

  • Inventi:mee/94/14
    MACROECONOMIC INSTABILITY AND BANKS LENDING BEHAVIOUR IN GHANA
    Ransford Quarmyne Churchill

    This study aims primarily at investigating the impact of macroeconomic instability on banking sector lending behaviour in Ghana using data on commercial banks and macroeconomic instability from 1992 to 2009. My results under the Co-integration and Vector Error Correction Modeling framework show that bank lending has a long-run relationship with macroeconomic instability. The study therefore, recommends that while banks should pay adequate attention to the consequences of their firm specific characteristics in their lending activities both in the short-run and long-run, their worries about macroeconomic instability should be limited to the long-run consequences on their lending behaviour. It is also pertinent that appropriate measures be taken to curtail inflation and sporadic money supply growth making banks become unfavourably disposed to lending given the attendant negative consequences of loan curtailment on economic growth in the long run.

    How to Cite this Article
    CC Compliant Citation: Ransford Quarmyne Churchill, Macroeconomic Instability and Banks Lending Behaviour in Ghana, European Scientific Journal, April 2014 edition vol.10, No.10, 397-414.
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