TITLE:
A Multiple Linear Regression Approach to Understanding the Role of Financial Institutions in Economic Development
AUTHORS:
Ezekiel K. Duramany-Lakkoh, Richard Ngebeh, Albert Beah
KEYWORDS:
Financial Institutions, Economic Development, Financial System, Sierra Leone
JOURNAL NAME:
Theoretical Economics Letters,
Vol.16 No.3,
June
29,
2026
ABSTRACT: The main purpose of this paper is to understand the role of financial institutions in economic development. Both the primary and secondary sources of data were used in the course of this study. The study also makes use of the qualitative data in the form of literature and for data analysis in various stages in the study. The secondary data collected were analysed using EViews version 8. The findings from the study revealed that Domestic Credit to Private Sector (DCPS) has a negative relationship on the Gross Domestic Product (GDP) with a coefficient value of (?0.364423). The data further revealed that this relationship is highly insignificant (p-value of 0.4454 and t-stats of ?0.766265). The study also shows that there is also a non-significant relationship between DCPS and GDP (r = ?0.032771 and p-value = 0.9006). The findings from the study revealed that Deposit Interest Rates (DIR) have a positive coefficient value of (1.771626), which is also highly significant (p-value of 0.0040 and t-stats of 2.951361) on the Gross Domestic Product (GDP). The study also revealed that there is a significant relationship between DIR and GDP (r = 0.368847 and p-value = 0.1451).