The main purpose of this paper is to understand the role of financial institutions in economic development. Both the primary and secondary sources of data were used in the course of this study. The study also makes use of the qualitative data in the form of literature and for data analysis in various stages in the study. The secondary data collected were analysed using EViews version 8. The findings from the study revealed that Domestic Credit to Private Sector (DCPS) has a negative relationship on the Gross Domestic Product (GDP) with a coefficient value of (?0.364423). The data further revealed that this relationship is highly insignificant (p-value of 0.4454 and t-stats of ?0.766265). The study also shows that there is also a non-significant relationship between DCPS and GDP (r = ?0.032771 and p-value = 0.9006). The findings from the study revealed that Deposit Interest Rates (DIR) have a positive coefficient value of (1.771626), which is also highly significant (p-value of 0.0040 and t-stats of 2.951361) on the Gross Domestic Product (GDP). The study also revealed that there is a significant relationship between DIR and GDP (r = 0.368847 and p-value = 0.1451).
Aghion, P., Howitt, P., & Mayer-Foulkes, D. (2005). The Effect of Financial Development on Convergence: Theory and Evidence. Quarterly Journal of Economics, 120, 173-222. https://doi.org/10.1162/qjec.2005.120.1.173
Amissah, E. (2018). Capital Flows, Trade and the Role of the Financial System. Modern Economy, 9, 1592-1617. https://doi.org/10.4236/me.2018.99099
Bencivenga, V. R., & Smith, B. D. (1991). Financial Intermediation and Endogenous Growth. The Review of Economic Studies, 58, 195-209. https://doi.org/10.2307/2297964
Bondie, Z., Kane, A., & Marcus, J. A. (2009). Investments (8 ed.). McGraw Hill.
Caporale, G. M., Rault, C., Sova, R., & Sova, A. (2009). Financial Development and Economic Growth: Evidence from Ten New EU Members. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.1499786
Cooper, D. R., & Schindler, P. S. (2003). Business Research Methods (8th ed.). McGraw Hill.
David (2006). Fiscal Policy and Financial Development. IMF Working Paper. https://www.elibrary.imf.org/view/journals/001/2006/026/article-A000-en.pdf
Demetriades, P. O., & Hussein, K. A. (1996). Does Financial Development Cause Economic Growth? Time-Series Evidence from 16 Countries. Journal of Development Economics, 51, 387-411. https://doi.org/10.1016/s0304-3878(96)00421-x
Duramany-Lakkoh, E. K. (2021a). Foreign Aid and Economics Development Nexus: The Case of Sierra Leone. Archives of Business Research, 9, 219-233.
Duramany-Lakkoh, E. K. (2021b). Surveying the Socioeconomic and Business Dimensions of Microfinance Institutions in Rural Sierra Leone before the Ebola Outbreak: A Descriptive Statistical Approach. Journal of Financial Risk Management, 10, 172-186.
Duramany-Lakkoh, E. K., Jalloh, M. S., & Jalloh, A. (2022). An Empirical Examination of the Impact of Banks on Economic Growth in Sierra Leone (2001-2017). Journal of Financial Risk Management, 11, 258-276. https://doi.org/10.4236/jfrm.2022.112013
Easton, V. J., & McColl, J. H. (1997). Confidence Intervals’ in Statistics Glossary. https://eprints.gla.ac.uk/120164/
Ghazi, R. (2019). Financial Institutions and Their Role in the Development and Financing of Small Individual Projects. NeuroQuantology , 20, 2333-2340.
Greenwood, J., & Jovanovich, B. (1990). Financial Development, Growth, and the Distribution of Income. Journal of Political Economy, 98, 1076-1107. https://doi.org/10.1086/261720
Kemal, A., Qayyum, A., & Hanif, M. N. (2007). Financial Development and Economic Growth: Evidence from a Heterogeneous Panel of High Income Countries. The Lahore Journal of Economics, 12, 1-34.
Kenourgios, D., & Samitas, A. (2007). Financial Development and Economic Growth in a Transition Economy: Evidence for Poland. Journal of Financial Decision Making, 3, 35-48.
Khan, E. A. (2015). The Role of Financial Institutions and the Economic Growth. European Journal of Business and Management, 7, 95-98.
King, R. G., & Levin, R. (1993). Finance and Growth: Schumpeter Might Be Right. The Quarterly Journal of Economics, 108, 717-737. https://doi.org/10.2307/2118406
Levine, R. (1997). Financial Development and Economic Growth: Views and Agenda. Journal of Economic Literature, 35, 688-726.
Levine, R., Loayza, N., & Beck, T. (2000). Financial Intermediation and Growth: Causality and Causes. Journal of Monetary Economics, 46, 31-77. https://doi.org/10.1016/s0304-3932(00)00017-9
Lucas, R. E. (1988). On the Mechanics of Economic Development. Journal of Monetary Economics, 22, 3-42. https://doi.org/10.1016/0304-3932(88)90168-7
Mensah, D. D. (2012). Describing the Current Situation of the Financial Markets. https://scispace.com/papers/describing-the-current-situation-of-the-financial-market-in-octtg1fjby
Patrick, H. T. (1996). Financial Development and Economic Growth in Underdeveloped Countries. Economic Development and Cultural Change, 14, 174-189. https://doi.org/10.1086/450153
Pradesh, A. (2006). Economic Theory. Publishing House PVT Ltd.
Robinson, J. (1952). The Generalization of the General Theory. In The Rate of Interest and Other Essays (67-142). MacMillan.
Schumpeter, J. A. (1911). The Theory of Economic Development. Harvard University Press.
Solow, R. M. (1956). A Contribution to the Theory of Economic Growth. The Quarterly Journal of Economics, 70, 65-94. https://doi.org/10.2307/1884513
Sunday, K. J., & David, A. K. (2011). Financial Institutions as Catalyst to Economic Development: The Nigerian. European Journal of Humanities and Social Sciences, 8, 1-12.
Sutton, C. N., & Jenkins, B. (2007). The Role of Financial Services in Expanding Economic Opportunity. https://dash.harvard.edu/server/api/core/bitstreams/c87a87f1-ffa4-43f3-a609-a5e2702a622b/content
Swan, T. W. (1956). Economic Growth and Capital Accumulation. Economic Record, 32, 334-361. https://doi.org/10.1111/j.1475-4932.1956.tb00434.x
Waqabaca, C. (2004). Financial Development and Economic Growth in Fiji. Working Paper 2004/03 Reserve Bank of Fiji, Economics Department.
Wood, A. (1993). Financial Development and Economic Growth in Barbados: Causal Evidence. Savings and Development, 17, 379-390.
Yosha, O. (1992). Essays on the Structure of Financial Markets. https://en-econ.tau.ac.il/sites/economy_en.tau.ac.il/files/media_server/Economics/PDF/Yosha-PhD.pdf