The Relationship between Bank Credit and Economic growth: Evidence from Manchester between 2009-2019

Economic growth and development is influenced by an increase in bank credit for business organizations, which involves growth in the gross domestic product (GDP). Bank credit plays the role of providing necessary financial resources to enable economic activities. Empirical research reveals a positive relationship between economic growth and bank credit. Meanwhile, other studies have considered the possibility bank credit has not always been sustainable in specific instances, resulting in declining economic growth rate. The study analysis is based on the hypothesis that bank credit plays a significant function in economic growth. The sample period for this study span 2009-2019, and the study was conducted based on data borrowed from the National survey of the Bank of England. Using dynamic generalized method of moments (GMM), this study, concluded that bank credit plays a leading role in providing the necessary financial resources to enable economic growth for Manchester.