Aikaeli, JehovanessMbellenge, Costantine Richard2016-05-112016-05-112015-09Aikaeli, J. & Mbellenge, C. The Causal Relationship between Financial Development and Economic Performance in Tanzania. SSRN Electronic Journal. http://dx.doi.org/10.2139/ssrn.27060341556-5068http://hdl.handle.net/20.500.11810/1985This study determines causal relationship between financial development and economic performance in Tanzania. The study employs cointegration and vector error correction model techniques. Granger causality test was applied to ascertain causation between financial development and economic performance. Overall economic performance is measured by the GDP out-turn; and proxies of financial development are: the ratio of money supply to nominal GDP; and growth of credit to private sector. The results show that there is a stable long-run relationship between financial development and economic performance in Tanzania. Granger causality test indicates that the causality runs from financial development to economic performance.enGrowthCredit to private sectorMoney supplyFinancial developmentJournal Article