STOCK MARKET CAPITALIZATION AND ECONOMIC GROWTH IN ASEAN6

Abstract

The objective of this article is to study overview the ASEAN stock market before the ASEAN Economic Community (AEC) was established by the end of 2015 and quantify the impact of the stock market capitalization to economic growth in six ASEAN countries including Thailand, Singapore, Philippines, Indonesia, Malaysia, and Vietnam (ASEAN6). In the quantitative study, General Least Square (GLS) to test the impact of stock market size on economic growth in ASEAN6 countries. Data collected from the World Bank during the period 2000-2014. The research using the dependent variable is the growth rate of gross domestic product - representing the annual economic growth rate, independent variable representing the scale of development of the stock market is calculated by taking the stock market capitalization value per the gross domestic product value; in addition, other control variables used in the model include government expenditure and level open trade. The results show that all three variables have a positive impact on economic growth in ASEAN6. Research results are valuable for managers in providing some suggestions for developing sustainable stock markets, contributing to economic growth in these countries.