JOURNAL OF APPLIED BUSINESS AND ECONOMICS
Stock Market & the Economy: Evidence from Philippines
Author(s): D Dulani Jayasuriya
Citation: D Dulani Jayasuriya, (2018) "Stock Market & the Economy: Evidence from Philippines," Journal of Applied Business and Economics, Vol. 20, Iss.2, pp. 48-58
Article Type: Research paper
Publisher: North American Business Press
Abstract:
This study reviews prior literature on the relationship between the stock market and the economy and
conducts a simple analysis on the same empirically for Philippines. The study utilizes quarterly data from 2003 to 2015. Results show that increases in past quarter real GDP growth causes a 0.56 increase in the present quarter real GDP growth. In addition, increases in past quarter PSI index returns cause a 0.04 increase in real GDP growth in the present quarter. Moreover, the study identifies an inflation-GDP growth puzzle for Philippines. Results support the permanent income and the financial accelerator views.