ANALYSING THE RECIPROCAL RELATIONSHIP BETWEEN THE BANKING SECTOR AND THE HUMAN DEVELOPMENT INDEX IN ARAB ECONOMIES
Al-Shimari, Kamal K. Jawad 1, Jihad Faisal Jihad 2*
1,2University of Kerbala/ College of Administration and Economics / Financial and Banking Sciences Department, Iraq
Email: 1 Kamal.k@uokerbala.edu.iq, 2* jihad.f@uokerbala.edu.iq
Abstract
Purpose of the study: This study aims to highlight the concept of the banking sector and human development. We also try to test the reciprocal relationship between the banking sector and human development in a sample of Arab countries (Algeria, Saudi Arabia, Kuwait).
Methodology: The study is scientifically based on the statistical package program (SPSS.V.25). Some statistical tools, such as testing the normal distribution of data, and the simple correlation test (Pearson), were used for the purpose of testing the main hypotheses for Arab countries, the study sample for the period (2010-2018).
Main Findings: The results showed a statistically significant correlation between the banking sector and (HDM) Human Development Index in the Arab countries, the sample of the study for the period 2010 to 2018. There is also an inverse correlation between the Bank nonperforming loans index and the human development index. There is correlation between the two indicators: Domestic credit provided by banking sector, Bank capital to assets ratio, and Human Development Index.
Applications of this study: The importance of this study lies in assessing the relationship between the banking sector and human development in Algeria, Saudi Arabia and Kuwait, given that the economies of these countries are rich in natural resources, which is reflected in their receipt of large financial resources that can be invested in the banking sector to achieve human development.
Novelty/Originality of this study: The study relies on a set of recent literature in analyzing the theoretical side, in addition to linking variables related to the banking sector with the Human Development Index, which generally works to stimulate economic development in the Arab countries, the sample of the study.
Keywords: Banking Sector, Human Development, Arab Economies, Nonperforming Loans, Gross Domestic Product.
