The synergistic effects of remittances, savings, education and digital financial technology on economic growth in Sub-Saharan Africa

Joseph Antwi Baafi and Michael Kwame Asiedu

Journal of Electronic Business & Digital Economics, 2025, vol. 4, issue 1, 132-150

Abstract: Purpose - This paper aims to investigate the impact of remittances, savings and education on economic growth in Sub-Saharan Africa. The study focuses on understanding how these factors independently and interactively contribute to growth, with a specific emphasis on their potential to drive sustainable economic development in the region. Design/methodology/approach - The study employs a panel dataset comprising 23 Sub-Saharan African countries over the period from 1974 to 2020. The system generalized method of moments (GMM) estimation technique is utilized to address potential endogeneity issues and also explore the interactions between these variables to assess their combined influence on growth. Findings - The findings reveal that remittances, savings and education have a significantly positive effect on economic growth in Sub-Saharan Africa. Additionally, the study finds that the interactions between remittances and both savings and education are positively and significantly associated with economic growth. Practical implications - The results indicate that Sub-Saharan African countries could harness the full potential of remittances to drive economic growth by implementing policies that encourage a savings culture and improve educational outcomes. Originality/value - This paper contributes to the literature by providing a comprehensive analysis of the independent and interactive effects of remittances, savings and education on economic growth in Sub-Saharan Africa. The study's use of the System GMM approach allows for robust estimation, accounting for potential endogeneity, and offers new insights into how these factors work together to influence economic development in the region.

Keywords: Remittances; Savings; Education; Economic growth; SSA; E21; F22; F24; I25; O47 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jebdep:jebde-08-2024-0026

DOI: 10.1108/JEBDE-08-2024-0026

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