Abstract
Developed financial markets act as a catalyst in promoting greater economic growth for nations. Healthy financial market growth among nations is found to improve good job creations and aid economic growth in line with Sustainable Development Goal 8. Developing economies could emulate the growth principles from developed economies on financial market development. This paper analyzes the impact of financial market development and economic growth in middle-income and high-income countries of ASEAN and CEE countries from 2002 to 2019. Annual time series data were sourced from World Bank using stock market development indicators. The panel data based on the random effect model was employed to determine the correlation between stock market development and economic growth. The findings of the study reveal that market capitalization and total stock traded from the total value positively impact economic growth. In contrast, the relationship between the stock traded of domestic share and GDP growth is negative. To foster greater economic growth, countries and policymakers need to focus on developing the financial market sector and maintaining the macroeconomic stability.
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