Governance quality and economic growth in Sub-Saharan Africa: the dynamic panel model

2022 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Amsalu Bedemo Beyene
Keyword(s):  
Economic Growth ◽  
Rule Of Law ◽  
African Countries ◽  
Content Type ◽  
Government Effectiveness ◽  
The Rule Of Law ◽  
Governance Quality ◽  
Sub Saharan ◽  
The Government

PurposeThe main objective of this article is to analyze the role of governance quality in influencing the economic growth of 22 selected Sub-Saharan African Countries.Design/methodology/approachThe study applied the panel dynamic Generalized Method of Moments (GMM) to analyze the data obtained from the World Bank database over the period from 2002 to 2020.FindingsThe overall finding indicated that the composite governance index has a positive significant effect on the economic growth of the countries; where a unit improvement in the aggregate governance index leads to a 3.05% increase in GDP. The disaggregated result has shown that corruption control and government effectiveness have a negative significant effect on growth performance, whereas, the rule of law and regulatory quality showed a positive significant effect. Political stability and voice and accountability have an insignificant effect on economic growth.Research limitations/implicationsDue to data limitations, this study could not address the whole members of Sub Sahara African Countries and could not see the causal relationship.Practical implicationsThe study suggested a strong commitment to the implementation of policy and reform measures on all governance factors. This may add to the need to devise participatory corruption control mechanisms; to closely look at the proper implementation of policies and reforms that constitute the government effectiveness factors, and properly implement the rule of law at all levels of the government with a strong commitment to realizing it so that citizens at all levels can have full confidence in and abide by the rules of society.Originality/valueEven though there are some studies conducted using conventional methods of panel data analysis such as random effect or fixed effects, this empirical study used more advanced panel dynamic generalized moment of methods to examine the role of improvement in governance quality on economic growth.

scholarly journals Financial access, governance and insurance sector development in sub-Saharan Africa

2020 ◽  
Vol 47 (4) ◽  
pp. 849-875 ◽  
Author(s):  
Simplice Asongu ◽  
Nicholas M. Odhiambo
Keyword(s):  
Rule Of Law ◽  
Life Insurance ◽  
Political Stability ◽  
Sub Saharan Africa ◽  
Financial Access ◽  
Content Type ◽  
Government Effectiveness ◽  
The Rule Of Law ◽  
Sub Saharan

PurposeThis study investigates the role of financial access in moderating the effect of governance on insurance consumption in 42 sub-Saharan African countries using data for the period 2004–2014.Design/methodology/approachTwo life insurance indicators are used, notably: life insurance and non-life insurance. Six governance measurements are also used, namely: political stability, ‘voice and accountability’, government effectiveness, regulation quality, corruption-control and the rule of law. The empirical evidence is based on the Generalised Method of Moments (GMM) and Least Squares Dummy Variable Corrected (LSDVC) estimators.FindingsEstimations from the LSDVC are not significant while the following main findings are established from the GMM. First, financial access promotes life insurance through channels of political stability, ‘voice and accountability’, government effectiveness, the rule of law and corruption-control. Second, financial access also stimulates non-life insurance via governance mechanisms of political stability, ‘voice and accountability’, government effectiveness, regulation quality, the rule of law and corruption-control.Originality/valueThis research complements the sparse literature on insurance promotion in Africa by engaging the hitherto unexplored role of financial access through governance channels.

scholarly journals Finance, governance and inclusive education in Sub-Saharan Africa

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Simplice A. Asongu ◽  
Nicholas M. Odhiambo
Keyword(s):  
Secondary Education ◽  
Inclusive Education ◽  
Rule Of Law ◽  
Generalized Method Of Moments ◽  
Sub Saharan Africa ◽  
Content Type ◽  
Credit Access ◽  
Government Effectiveness ◽  
The Rule Of Law ◽  
Sub Saharan

Purpose The purpose of this paper is to assess the importance of credit access in modulating governance for gender-inclusive education in 42 countries in Sub-Saharan Africa with data spanning the period 2004–2014. Design/methodology/approach The generalized method of moments is used as empirical strategy. Findings The following findings are established: First, credit access modulates government effectiveness and the rule of law to induce positive net effects on inclusive “primary and secondary education.” Second, credit access also moderates political stability and the rule of law for overall net positive effects on inclusive secondary education. Third, credit access complements government effectiveness to engender an overall positive impact on inclusive tertiary education. Originality/value Policy implications are discussed with emphasis on sustainable development goals.

Poland-EU constitutional crisis will not end soon

2016 ◽  
Keyword(s):  
Economic Growth ◽  
European Commission ◽  
Rule Of Law ◽  
Content Type ◽  
The Rule Of Law ◽  
Constitutional Tribunal ◽  
The Government ◽  
Polish Government ◽  
The Eu

Subject European Commission concerns about the rule of law in Poland. Significance The Commission has sent a formal Opinion to the Polish government, activating the first stage in the EU's 'Rule of Law Framework'. It expresses concerns about respect for the rule of law in Poland (a fundamental founding value of the EU), and in particular about the Polish government's handling of the crisis over the Constitutional Tribunal (TK, for Trybunał Konstytucyjny) Impacts Poland's EU position is likely to suffer as a result of the dispute, making it more difficult for it to achieve other political goals. Polish politics will remain unsettled and polarised, with the opposition using the Commission's Opinion to challenge the government. Legal uncertainty may translate into lower investment by individuals and enterprises dampening economic growth in the medium-to-long term.

scholarly journals Information technology, governance and insurance in Sub-Saharan Africa

2019 ◽  
Vol 16 (8) ◽  
pp. 1253-1273 ◽  
Author(s):  
Simplice Asongu ◽  
Joseph Nnanna ◽  
Paul Acha-Anyi
Keyword(s):  
Rule Of Law ◽  
Life Insurance ◽  
Political Stability ◽  
Sub Saharan Africa ◽  
Content Type ◽  
Government Effectiveness ◽  
The Rule Of Law ◽  
Internet Penetration ◽  
Insurance Penetration ◽  
Sub Saharan

Purpose This study aims to investigate the role of information and communication technology (ICT) in modulating the effect of governance on insurance penetration in 42 Sub-Saharan African countries using data for the period 2004-2014. Design/methodology/approach Two insurance indicators are used in the analysis, namely, life insurance and non-life insurance. The three ICT modulating dynamics used include mobile phone penetration, internet penetration and fixed broadband subscriptions. Six governance channels are also considered, namely, political stability, “voice & accountability”, regulation quality, government effectiveness, the rule of law and corruption-control. The empirical evidence is based on generalized method of moments. Findings The following main findings are established. First, mobile phone penetration does not significantly modulate governance channels to positively affect life insurance while it effectively complements “voice & accountability” to induce a positive net effect on non-life insurance. Second, internet penetration complements governance dynamics of political stability, government effectiveness and rule of law to induce positive net effects on life insurance and corruption-control for an overall positive effect on non-life insurance. Third, the relevance of fixed broadband subscriptions in promoting life insurance is apparent via governance channels of regulation quality, government effectiveness and the rule of law while fixed broadband subscriptions do not induce significant overall net effects on non-life insurance though the conditional effects are overwhelmingly significant. Originality/value To the best of the authors’ knowledge, studies on the relevance of ICT in promoting insurance consumption through governance channels are sparse, especially for a region such as Sub-Saharan Africa where insurance penetration is low compared to other regions of the world.

scholarly journals Mediating role of trust in the relationship between public governance quality and tax compliance

2022 ◽  
Vol 3 (4) ◽  
pp. 11-22
Author(s):  
Yusuf Mohammed Alkali ◽  
Abdulsalam Masud ◽  
Almustapha A. Aliyu
Keyword(s):  
Rule Of Law ◽  
Tax Compliance ◽  
Political Stability ◽  
African Countries ◽  
Public Governance ◽  
Government Effectiveness ◽  
Regulatory Quality ◽  
Governance Quality ◽  
Control Of Corruption

This paper examined the mediating role of trust in government on the influence of public governance quality indicators (accountability, political stability, government effectiveness, regulatory quality, rule of law, and control of corruption) on tax compliance in Africa. Cross-country data obtained from 38 African countries for 2015 was used and analyzed using Ordinary Least Squares (OLS) regression analysis. The study found that accountability, political stability, control of corruption, and trust have a significant influence on tax compliance among the sampled African countries, but government effectiveness, regulatory quality, and the rule of law and have insignificant influence on tax compliance. The result of the mediating effects revealed that trust mediates the influence of accountability and political stability on tax compliance in Africa. However, it failed to mediate the influence of government effectiveness, regulatory quality, rule of law, and control of corruption on tax compliance among sample African countries. The study offers theoretical insights on the role of trust as a mediator on social exchange relationships from the context of public governance quality on tax compliance. It also implies to the policymakers that building trust is an important mechanism through which the impact of public governance on tax compliance would be more pronounced. The study further calls for replication of its findings in other continents such as the Americas, Asia, and Europe.

scholarly journals Hypothesizing directional causality between the governance indicators and economic growth: the case of Afghanistan

2020 ◽  
Vol 6 (1) ◽  
Author(s):  
Mohammad Naim Azimi ◽  
Mohammad Musa Shafiq
Keyword(s):  
Economic Growth ◽  
Rule Of Law ◽  
Time Series Data ◽  
Political Stability ◽  
Wald Test ◽  
Series Data ◽  
Vector Autoregressive ◽  
Government Effectiveness ◽  
Governance Indicators ◽  
The Government

AbstractThis paper examines the causal relationship between governance indicators and economic growth in Afghanistan. We use a set of quarterly time series data from 2003Q1 to 2018Q4 to test our hypothesis. Following Toda and Yamamoto’s (J Econom 66(1–2):225–250, 1995. 10.1016/0304-4076(94)01616-8) vector autoregressive model and the modified Wald test, our empirical results show a unidirectional causality between the government effectiveness, rule of law, and the economic growth. Our findings exhibit significant causal relationships running from economic growth to the eradication of corruption, the establishment of the rule of law, quality of regulatory measures, government effectiveness, and political stability. More interestingly, we support the significant multidimensional causality hypothesis among the governance indicators. Overall, our findings not only reveal causality between economic growth and governance indicators, but they also show interdependencies among the governance indicators.

Interactive effects of human capital in finance–economic growth nexus in Sub-Saharan Africa

2018 ◽  
Vol 45 (6) ◽  
pp. 1192-1210 ◽  
Author(s):  
Muazu Ibrahim
Keyword(s):  
Economic Growth ◽  
Human Capital ◽  
Interactive Effect ◽  
Financial Sector ◽  
Content Type ◽  
Long Run ◽  
The World ◽  
Sub Saharan ◽  
Ssa Countries

Purpose The purpose of this paper is to examine the interactive effect of human capital in financial development–economic growth nexus. Relative to the quantity-based measure of enrolment rates, the main aim was to determine how quality of human capital proxied by pupil–teacher ratio influences the relationship between domestic financial sector development and overall economic growth. Design/methodology/approach Data are obtained from the World Development Indicators of the World Bank for 29 sub-Saharan African (SSA) countries over the period 1980–2014. The analyses were conducted using the system generalised method of moments within the endogenous growth framework while controlling for country-specific and time effects. The author also follows Papke and Wooldridge procedure in examining the long-run estimates of the variables of interest. Findings The key finding is that, while both human capital and financial development unconditionally promotes growth in both the short and long run, results from the interactive terms suggest that, irrespective of the measure of finance, financial sector development largely spurs growth on the back of quality human capital. This finding is also confirmed by the marginal and net effects where the interactive effect of pupil–teacher ratio and indicators of finance are consistently huge relative to the enrolment. Statistically, the results are robust to model specification. Practical implications While it is laudable for SSA countries to increase access to education, it is equally more crucial to increase the supply of teachers at the same time improving on the limited teaching and learning materials. Indeed, there are efforts to develop rather low levels of the financial sector owing to its unconditional growth effects. Beyond the direct benefit of finance, however, higher growth effect of finance is conditioned on the quality level of human capital. The outcome of this study should therefore reignite the recognition of the complementarity role of human capital and finance in economic growth process. Originality/value The study makes significant contributions to existing finance–growth literature in so many ways: first, the auhor extend the literature by empirically examining how different measures of human capital shape the finance–economic growth nexus. Through this the author is able to bring a different perspective in the literature highlighting the role of countries’ human capital stock in mediating the impact of financial deepening on economic growth. Second, the author makes a more systematic attempt to evaluate the relative importance of finance and human capital in growth process while controlling for several ancillary variables.

The role of financial development and corruption in environmental degradation of Sub-Saharan African countries

2020 ◽  
Vol 31 (4) ◽  
pp. 895-913 ◽  
Author(s):  
Nura Sani Yahaya ◽  
Mohd Razani Mohd‐Jali ◽  
Jimoh Olajide Raji
Keyword(s):  
Financial Development ◽  
Environmental Degradation ◽  
Empirical Studies ◽  
Ordinary Least Squares ◽  
Efficient Technology ◽  
African Countries ◽  
Credit Allocation ◽  
Content Type ◽  
Sub Saharan

PurposeThis study examines the role of financial development and its interaction with corruption in the environmental degradation of eight Sub-Saharan African countries from 2000–2014.Design/methodology/approachThe study utilizes Pedroni cointegration and fully modified ordinary least squares (FMOLS) techniques for the estimation of the models.FindingsThe results of the cointegration test reveal that there exist long-run relationships among the variables in the model with the interaction of financial development and corruption, and in the model without interaction. The FMOLS estimates show that in the former model, the interaction of financial development with corruption is positively significant in determining the level of environmental degradation in those countries. Moreover, in the latter, financial development, trade openness, and corruption have a positive effect on their environmental degradationResearch limitations/implicationsUnavailability of data, the study was limited to only eight Sub-Saharan African nationsPractical implicationsThe finding that financial development and its interaction with corruption have an adverse effect on the environments of the Sub-Saharan African countries implies the need to focus on how efficient credits are being allocated in those countries. For better management of environmental quality, this may require the implementation of policies that enhance credit allocation to users with energy-efficient technology and appliances that promote the quality of environments. In addition, stringent policies could be embarked upon to curtail all acts of corruption in the region for an efficient credit allocation and a better environment in the development of Sub-Saharan African society.Originality/valueThe dearth in empirical studies on the Sub-Saharan African countries motivates this study. In particular, little is known about the interaction effect of corruption and financial development on the environmental degradation of those countries, as the work on this is limited in the existing literature.

scholarly journals The role of records management in ensuring good governance in Africa

2020 ◽  
Vol 53 ◽  
pp. 103-123
Author(s):  
Olefhile Mosweu ◽  
Donald Rakemane
Keyword(s):  
Rule Of Law ◽  
Management Practices ◽  
Good Governance ◽  
Records Management ◽  
Access To Information ◽  
African Countries ◽  
The Rule Of Law ◽  
Economic Practices ◽  
African Context

Proper records management is central to the promotion of good governance. Africa is a continent which has generally been riddled with poor governance. Principles of good governance such as accountability, transparency and the rule of law are ascertained with available records. Poor records management practices promote bad economic practices such as corruption and fraud. An assessment of the performance of government can thus be realised through proper records management and access to information. Good records management practices therefore lead to good governance and vice versa; thus, the role of records management in promoting good governance cannot be overemphasised. However, there are some likely impediments that may hinder the promotion of good governance through records management in the African context. This paper explored the role played by records management in ensuring good governance in Africa. It then suggests strategies to promote good governance through proper records management practices. The paper contends that outdated archival laws, backlog of unprocessed records and absence of access to information laws in some African countries are the major impediments to the promotion of good governance. The paper recommends an amendment of outdated laws and the promulgation of access to information legislation as major initiatives, among others, which put records management in the forefront of promoting good governance in the continent.

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