The threshold effect of political institutions on the finance-growth nexus: Evidence from Sub-Saharan Africa

Walid Benayed, Nouha Bougharriou () and Foued Gabsi ()
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Nouha Bougharriou: Faculty of Economics and Management of Sfax, University of Sfax, Tunisia
Foued Gabsi: Faculty of Economics and Management of Sfax, University of Sfax, Tunisia

Economics Bulletin, 2020, vol. 40, issue 3, 2484-2493

Abstract: This study explores the effect of political institutions on the finance-growth nexus for a sample of 24 Sub-Saharan African countries over the period 2002-2011. Using the recent dynamic panel threshold model proposed by Seo and Shin (2016), we found that financial development has a growth-enhancing effect only in countries with strong political institutions. The results are robust across different institutional indicators.

Keywords: political institutions; financial development; dynamic panel threshold (search for similar items in EconPapers)
JEL-codes: G2 O4 (search for similar items in EconPapers)
Date: 2020-09-24
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Citations: View citations in EconPapers (4)

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