Impact of Stock Market and Financial Development on Sustainable Development in Kuwait

Abstract

This study aims to investigate the impact of the stock market trade openness and financial development on sustainable development in Kuwait. The study employed quarterly time series for analysis and from 1993-2018, and selected variables are Sustainable development, Stock market, financial development, and trade openness. Sustainable development is treated as a dependent variable, while the others are independent variables. It is concluded that a long run association among the stock market, financial development, trade and sustainable development exists. Autoregressive distributed lagged (ARDL) model is applied for long run and short run estimates. In long run stock market, trade openness and financial development are positive and significant factors of sustainable development, while in the short run, stock market is significant negative contributor to sustainable development. It is therefore recommended that efforts should be made to encourage the investor so that the stock market should grow in future. Similarly, efforts should be made to boost the financial and trade sector should that the country could grow economically, socially and environmentally.