Does institutional quality accelerate the growth of financial markets in Africa?

SN Business & Economics - Tập 3 - Trang 1-26 - 2023
Bruno Emmanuel Ongo Nkoa1, Thierry Mamadou Asngar2, Charles Christian Atangana Zambo1, Donald Ferdinand Okere Atanga3
1University of Yaounde II, Soa, Cameroon
2University of Ndjamena, Ndjamena, Chad
3University of Dschang, Dschang, Cameroon

Tóm tắt

In this paper, we investigate the effect of political and legal institutions on the growth of financial markets in 50 African countries over the period 1996–2016. Using the system generalized methods of moment strategy, we find that in Africa, financial market growth is explained by the quality of political and legal institutions. High levels of political constraints on the executive and protection of investors' rights result in improved performance of these markets. The results further reveal that political instability and corruption reduce the performance of political and legal institutions, eroding the African financial market’s performance, thereby constraining their growth. These results are consistent with several tests conducted. As a policy recommendation, governments should strengthen their political and legal institutions. This can be done through the adoption of anti-corruption measures and strong political stability.

Tài liệu tham khảo

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