(b) What do you mean by Granger Causality? Suppose a researcher fits following regressions Summarized table below: sample range: 2006Q3-2017Q4 Dependent Variable LIF LIF LGDP LGDP Constant 0.251465 -20.06647 -0.622394 -1.154321 LGDP(-1) 0.740372 1.022145 1.041612 LIF(-1) 0.966654 0.830521 -0.003965 RSS 0.237109 0.204244 0.000355 0.000330 Discuss the nature of causality between log GDP (LGDP) and log Islamic Finance (LIF)

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Q2 Part b

(b) What do you mean by Granger Causality? Suppose a researcher fits following
regressions
Summarized table below:
sample range: 2006Q3-2017Q4
Dependent Variable
Constant
LGDP(-1)
LIF(-1)
RSS
LIF
0.251465
0.966654
0.237109
LIF
-20.06647
0.740372
0.830521
0.204244
LGDP
-0.622394
1.022145
0.000355
LGDP
-1.154321
1.041612
-0.003965
0.000330
Discuss the nature of causality between log GDP (LGDP) and log Islamic Finance (LIF)
Transcribed Image Text:(b) What do you mean by Granger Causality? Suppose a researcher fits following regressions Summarized table below: sample range: 2006Q3-2017Q4 Dependent Variable Constant LGDP(-1) LIF(-1) RSS LIF 0.251465 0.966654 0.237109 LIF -20.06647 0.740372 0.830521 0.204244 LGDP -0.622394 1.022145 0.000355 LGDP -1.154321 1.041612 -0.003965 0.000330 Discuss the nature of causality between log GDP (LGDP) and log Islamic Finance (LIF)
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