The past decades have witnessed a wave of financial crises that have struck developed and developing economies. These crises have undermined confidence in the modern financial system and its ability to generate sustainable economic growth. As a result, there has been a growing interest among researchers in the field of comprehensive economic development in reconsidering the nature of the relationship between the development of the financial system and economic growth, considering various determining factors and interplaying interactions. Studies reveal that this relationship is complex and multifaceted and is affected by factors such as the quality of governance, inflation and inflation volatility levels. On the other hand, the interrelationship between innovation, financial development, and economic growth has recently emerged at the forefront of researchers’ interests, seeking to understand the complex dynamics that shape the structure of the contemporary economy. A consensus has emerged among many scholars that innovation and financial development represent two essential variables to ensure sustainable economic growth. Therefore, this thesis provides new evidence in examining the impact of governance quality on the finance-growth nexus, the impact of inflation and inflation volatility on the relationship between financial development and economic growth, and the three-way ties between economic growth, financial development, and innovation. The study has relied on a sample of G20 countries. Considering the significant roles that the G20 countries play in the global economy, it is worth investigating the factors that help to augment economic growth. Moreover, the G20 countries also include developed and developing countries; thus, the conclusions drawn from this study have rich significance. This thesis includes three main chapters. The first chapter used the panel ARDL technique to explore the influence of governance quality on the long and short-term finance-growth links. In chapter two, the interaction between growth, inflation, inflation volatility, and financial development is examined using a dynamic panel system GMM approach. Finally, by executing a Fully Modified Ordinary Least Square (FMOLS) estimation technique and the Dumitrescu-Hurlin Causality Test, the interactions between economic growth, financial development and innovation are explored in Chapter Three.
| Date of Award | 9 Jul 2025 |
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| Original language | English |
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| Supervisor | Shabbir Dastgir (Main Supervisor) |
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