Financial Development and Economic Growth in Kenya: Evidence from the Asymmetric Autoregressive Distributive Lag

Appropriate changes in financial development are largely known to cause growth. Inflation, gross capital formation and government expenditure, believably, succinctly controls the effects causes long term This paper analyzed this for Kenya paying exceptional attention on their asymmetric effects. The most reliable important results supported that positive asymmetries of increases run growth unlike negative with reducing weak However, case dynamics instabilities, economic responds negatively a steep slump shocks by declining as seems plausibly control such nonlinear positively causing Also, sustainable inflation prudent state expenditure spurs Since finance relationship supports supply-leading hypothesis, there is need specific policies which would alongside support if they spur real Moreover, risk managers required robustly prepare against have greater degenerating than upturn from shock.