The effect of Islamic finance on economic growth
Exchange scientist
-
Marouane Mezzourh, PhD student
Supervisor at Swiss institution
-
University of Basel: Aleksander Berentsen
Supervisor at MENA institution
-
University of Cadi Ayyad, Marrakech, Morocco: Mustapha Ziky
Presentation of the project
The main goal of this research stay was to deepen my understanding of my research project and learn more about modelling DSGE models. During my research stay at the University of Basel, I had the chance to explore how research in economics is conducted in Switzerland. I had the chance to attend to two lectures. The first lecture was the intermediate finance. In order to take the time dimension into account for my project, it was necessary to study a course such as intermediate finance. Multivariable optimization is very important to my model. the introduction of Islamic finance in Morocco is very recent. to empirically test its impact on economic growth in this country, it takes at least 5 or 6 years. it is for this reason that this course is very beneficial for my project in the sense that it gives an idea about the simulation methods that can replace a field survey. On the other hand, the financial markets consider themselves to be a connecting channel between finance and growth and this was the main purpose of this course.
The second lecture was econometrics. The contribution of econometrics lies in two elements. the first is related to the utilization of panel data for the construction of an article on the MENA region. Through this course, we have been able to know, theoretically and empirically, how to use this tool to know what is the impact of Islamic finance on economic growth in the same region based on a comparative study. The second point concerns macroeconometric modeling. Fixed effects and random effects models and instrumental variables serve as good tools for the empirical phase of my project. It is in fact to model by which channels of connection Islamic finance influences economic growth in Morocco.
During my stay, I had access to all the libraries of the University of Basel, where I spent most of my time, and I had also access to all electronic resources of the university. I had the chance to collect some macroeconomic data that would help me to test my empirical model, that based on testing the impact of finance on economic growth. Via my Uni bas account, I had access to journals and articles for free which were crucial to further understand my research questions and even having a new research perspective in this sense. Another activity was exploring the library archives and books, which was very rich of references in macroeconomics and in DSGE models. This documentary research helped me to finish the first part of my research project, which is the critical literature review of the effect of finance on growth in general, and specifically Islamic finance on economic growth.
I had also the chance working and exchanging with another senior PhD student and assistant of Prof. Berentsen. This student has already a good experience with DSGE models, which was the main empirical application of my research. I presented the goals of my research and methodology I am aiming to apply and I had some very useful and helping comments on how to go through my model and recommendation of further readings. One suggestion that really changed my whole perspective was the mathematical modelling. This approach will be a great input into my research.