The Effect of Financial Development on Industrial Exports: A Comparative Study of Selected Asian Countries

摘要

Development of the financial sector directly and indirectly effects on real subsection of economy. On the other hand, export developments of industrial goods can be underlying the industrial growth and development as one of the sectors of the economy development. In this study, the relationship between financial development and growth in exports of industrial goods is investigated in Iran and other selected countries in the Asia. Increased trade can increase a country's industries and enterprise need to the financial resources outside of the firms and industries, and subsequently, it causes further deepening the country's financial system. The study has been used test the Pedroni cointegration test of combinational data to investigate convergence relationship between financial development index (M2) and foreign trade (exports of industrial goods) in 1990-2012. The results show that there is a long-term significant positive convergence relationship between financial development and foreign trade (exports of industrial goods) in both East and West Asian countries. Therefore financial deepening and development is done by increasing exports of industrial goods in the economy of Iran, and on the other, increasing and deepening the country's financial development also cause the growth and expansion of foreign trade and exports of industrial goods in the country.