Research Article
Financial System Development and Economic Growth: A Critical Analysis of the Literature
Issue:
Volume 13, Issue 1, June 2024
Pages:
1-10
Received:
9 February 2024
Accepted:
28 February 2024
Published:
20 March 2024
DOI:
10.11648/j.jwer.20241301.11
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Views:
Abstract: Any developing countries (DCs) want to achieve strong, sustained growth to ensure their sustainable development by 2030. Indeed, promoting economic growth is one of the targets of the majority of the Sustainable Development Goals (SDGs) set by United Nations member countries. In their agenda, financial system development cited as an effective means of enabling developing countries to achieve high rates economic growth. However, research into the relationship between finance and growth has produced controversial results, showing that financial development is not always conducive to economic growth. These non-consensual findings call for further research into the subject. With this in mind, the aim of this paper is to critically analyze the literature on the subject with reference to the characteristics of developing countries. We have used the stylistic facts observed in these countries to see whether the way in which studies are conducted is in line with reality. These facts revealed that, as conducted, theoretical and empirical work does not really illustrate the nature of this relationship in the case of developing countries. The authors do not take into account certain specificities of these countries. The studies focus mainly on the formal financial sector, whereas in developing countries, the majority of the population is unbanked, so they tend to turn to the informal financial sector for savings and credit. In Pagano's theoretical model, on which most empirical work is based, the efficiency of financial intermediation is assumed to be an exogenous variable. However, in developing countries, many factors influence this function: poor governance, prevailing corruption, inefficiency of the legal system, government intervention in the financial sector, culture of non-repayment. Banking sector development is generally captured by credit to the private sector. However, in developing countries, the majority of bank credit is allocated to large commercial enterprises that sell mainly imported products. The indicators generally used to capture financial markets development do not reflect the amount of financing actually obtained by listed companies. Rather, they measure the level of secondary market activity, whose mission is to ensure the liquidity of securities and determine their prices. Taking account of financial dualism and integrating factors linked to the institutional environment, borrower behavior and financial intermediaries into the resource allocation function would be a significant advance in the literature.
Abstract: Any developing countries (DCs) want to achieve strong, sustained growth to ensure their sustainable development by 2030. Indeed, promoting economic growth is one of the targets of the majority of the Sustainable Development Goals (SDGs) set by United Nations member countries. In their agenda, financial system development cited as an effective means...
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Research Article
Examining Factors Affecting Presumptive Tax Voluntary Compliance (A Case Study in Gedeo Zone)
Kanbiro Orkaido*,
Tamirat Beyene,
Solomon Mitiku,
Yisehak Tesiso
Issue:
Volume 13, Issue 1, June 2024
Pages:
11-23
Received:
11 February 2024
Accepted:
28 February 2024
Published:
20 March 2024
DOI:
10.11648/j.jwer.20241301.12
Downloads:
Views:
Abstract: This research study aimed to analyze the factors influencing presumptive tax voluntary compliance in Gedeo Zone. The dependent variable, presumptive tax voluntary compliance, was examined in relation to various independent variables including collection enforcement, tax evasion, taxpayers' awareness, existence of corruption, tax incentives, transparency and fairness, and a supportive tax environment. A positivism research philosophy was adopted, utilizing a quantitative research approach and a cross-sectional research design. Primary data was collected through a Likert scale questionnaire from 318 targeted category "C" taxpayers. The findings of the ordered logistic regression indicated that collection enforcement, taxpayers' awareness, tax incentives, transparency and fairness, and a supportive tax environment have a statistically significant and positive influence on presumptive tax voluntary compliance in Gedeo Zone. Conversely, tax evasion and the existence of corruption were found to have a negative and statistically significant impact on taxpayers' compliance with presumptive tax. In conclusion, this study highlights the importance of implementing effective collection enforcement mechanisms, enhancing taxpayers' awareness programs, tax incentives, promoting transparency and fairness, and creating a supportive tax environment to enhance presumptive tax voluntary compliance. Furthermore, efforts should be made to tackle tax evasion and address issues related to corruption in order to improve compliance rates. The results of this study will aid policymakers and tax administrators in formulating strategies to enhance presumptive tax compliance in Gedeo Zone and potentially inform similar tax systems in other regions.
Abstract: This research study aimed to analyze the factors influencing presumptive tax voluntary compliance in Gedeo Zone. The dependent variable, presumptive tax voluntary compliance, was examined in relation to various independent variables including collection enforcement, tax evasion, taxpayers' awareness, existence of corruption, tax incentives, transpa...
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