Business Environment, Fintech and Economic Development in Selected Countries

Abstract

The present study attempts to examine the relationship between business environment, fintech and economic development in selected countries by using the dynamic generalized method of moment’s model during the period of 2000 to 2022. It was found that for one unit of increase in the improvement of business environment, fintech, labor, capital and education, the economic development of selected OECD countries showed the increase of 32, 54, 40, 54 and 32 units and for selected OPEC countries, the increase of 12, 15, 20, 23 and 15 units were observed, respectively. The business environment improvement is considered as one of the main challenges and priorities in the economy of countries and can be assumed an important element in attaining the growth and economic development goals. It is worth to mention that the business environment is a critical factor for the economic and institutional situation of a country and determines the investment horizon in the countries. The business environment progress plays a significant role in expanding the activities of the private sector and potential entrepreneurs to pave the ground for increasing growth. On the other hand, according to the estimation results of the fintech model, its effect on economic development has been positive and significant. Increasing the fintech index leads to financing more production and service economic projects. An increase in the fintech index can result into the growth of the production of goods as well as presenting much services, and as a result, the improvement of the business environment and more raw materials, which can have a positive impact on the economic progress index; therefore, focusing on the economic development stability in each country should be one of the important issues that receives much attention by governmental authorities and officials.