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Financial Inclusion, Investments and Economic Growth: Does Investment Mediate Financial Inclusion for Economic Growth in Africa?

Author

Listed:
  • Gladys A. A. Nabieu
  • Amoah T. Kwabena
  • James D. Ntiamoah

    (University of Professional Studies, Accra (UPSA))

Abstract

The study examines unresolved literature on the effects and mediating role of financial inclusion, investment, and economic growth interrelationships in 41 African countries from 2009-2019. We find strong evidence that public and foreign direct investments significantly and positively affect economic growth. But then, financial inclusion and private investments adversely affect economic growth. The Preacher and Hayes bootstrapping approach employed to analyze the mediating effects shows that public investments fully mediate the financial inclusion-economic growth nexus in Africa. African states should make financial inclusion a national responsibility as it boosts capital formation and infrastructure for economic growth.

Suggested Citation

  • Gladys A. A. Nabieu & Amoah T. Kwabena & James D. Ntiamoah, 2023. "Financial Inclusion, Investments and Economic Growth: Does Investment Mediate Financial Inclusion for Economic Growth in Africa?," The African Finance Journal, Africagrowth Institute, vol. 25(1), pages 63-84.
    • Handle: RePEc:afj:journl:v:25:y:2023:i:1:p:63-84
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    File URL: https://journals.co.za/doi/abs/10.10520/ejc-finj_v25_n1_a4
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    More about this item

    Keywords

    Financial Inclusion; Mediating Effect; Economic Growth;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • G20 - Financial Economics - - Financial Institutions and Services - - - General

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