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Finance and Democracy in Africa

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  • Simplice A. Asongu

    (African Governance and Development Institute,Yaoundé, Cameroon)

Abstract

This paper focuses on how political regimes affect financial developments in Africa and the role of dominant religion, income levels and colonial legacies in this regard. The findings indicate that authoritarian regimes have a higher propensity to effect policies that favour the development of financial intermediary depth, activity and size. Democracy has important effects on the degree of competition for public offices but is less significant in influencing policies related to promoting financial development when compared with autocracies. Once democracy is initiated, it should be accelerated (to edge out the appeals of authoritarian regimes) to reap the benefits of level and time hypotheses in financial development.

Suggested Citation

  • Simplice A. Asongu, 2014. "Finance and Democracy in Africa," Institutions and Economies (formerly known as International Journal of Institutions and Economies), Faculty of Economics and Administration, University of Malaya, vol. 6(3), pages 92-116, October.
  • Handle: RePEc:umk:journl:v:6:y:2014:i:3:p:92-116
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    2. Simplice A. Asongu, 2014. "African financial development dynamics: big time convergence," African Journal of Economic and Management Studies, Emerald Group Publishing, vol. 5(2), pages 160-194, July.
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    20. Simplice A Asongu, 2012. "On the effect of foreign aid on corruption," Economics Bulletin, AccessEcon, vol. 32(3), pages 2174-2180.
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    29. Simplice A. Asongu, 2012. "Law and Finance in Africa," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 55(4), pages 385-408.
    30. Daron Acemoglu & Simon Johnson, 2005. "Unbundling Institutions," Journal of Political Economy, University of Chicago Press, vol. 113(5), pages 949-995, October.
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    35. Simplice A. Asongu, 2013. "Real and monetary policy convergence: EMU crisis to the CFA zone," Journal of Financial Economic Policy, Emerald Group Publishing, vol. 5(1), pages 20-38, April.
    36. Asongu Simplice, 2011. "Government Quality Determinants of Stock Market Performance in African Countries," Working Papers of the African Governance and Development Institute. 11/019, African Governance and Development Institute..
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    Cited by:

    1. Simplice Asongu, 2014. "Are proposed African monetary unions optimal currency areas? Real, monetary and fiscal policy convergence analysis," African Journal of Economic and Management Studies, Emerald Group Publishing, vol. 5(1), pages 9-29, April.
    2. Asongu, Simplice A & Odhiambo, Nicholas M, 2019. "Enhancing governance for environmental sustainability in Sub-Saharan Africa," Working Papers 26282, University of South Africa, Department of Economics.
    3. Asongu Simplice, 2012. "How has Mobile Banking Stimulated Financial Development in Africa?," Working Papers of the African Governance and Development Institute. 12/027, African Governance and Development Institute..
    4. Asongu Simplice, 2014. "Fighting African corruption when existing corruption-control levels matter in a dynamic cultural setting," International Journal of Social Economics, Emerald Group Publishing, vol. 41(10), pages 906-922, October.
    5. Simplice A. Asongu, 2013. "Real and monetary policy convergence: EMU crisis to the CFA zone," Journal of Financial Economic Policy, Emerald Group Publishing, vol. 5(1), pages 20-38, April.
    6. Simplice A, Asongu, 2012. "Politics and Consumer Prices in Africa," MPRA Paper 36174, University Library of Munich, Germany.
    7. Simplice A. Asongu & Joseph Nnanna, 2020. "Governance and the capital flight trap in Africa," Transnational Corporations Review, Taylor & Francis Journals, vol. 12(3), pages 276-292, July.
    8. Asongu Simplice, 2012. "Are financial benefits of financial globalization questionable until greater domestic financial development has taken place?," Working Papers of the African Governance and Development Institute. 12/007, African Governance and Development Institute..
    9. Simplice A. Asongu & Jules R. Minkoua N., 2018. "Dynamic openness and finance in Africa," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 27(4), pages 409-430, May.
    10. Simplice A. Asongu, 2014. "African financial development dynamics: big time convergence," African Journal of Economic and Management Studies, Emerald Group Publishing, vol. 5(2), pages 160-194, July.
    11. Simplice A. Asongu, 2013. "How has Mobile Phone Penetration Stimulated Financial Development in Africa?," Journal of African Business, Taylor & Francis Journals, vol. 14(1), pages 7-18, April.
    12. Simplice A. Asongu & Thales P. Yapatake Kossele & Joseph Nnanna, 2021. "Not all that glitters is gold: political stability and trade in Sub-Saharan Africa," Research Africa Network Working Papers 21/005, Research Africa Network (RAN).
    13. Simplice A. Asongu, 2014. "Linkages between investment flows and financial development: Causality evidence from selected African countries," African Journal of Economic and Management Studies, Emerald Group Publishing, vol. 5(3), pages 269-299, August.
    14. Asongu Simplice, 2012. "Are Proposed African Monetary Unions Optimal Currency Areas? Real and Monetary Policy Convergence Analysis," Working Papers of the African Governance and Development Institute. 12/005, African Governance and Development Institute..
    15. Arayssi, Mahmoud & Fakih, Ali, 2017. "Finance–growth nexus in a changing political region: How important was the Arab Spring?," Economic Analysis and Policy, Elsevier, vol. 55(C), pages 106-123.
    16. Simplice A Asongu, 2013. "How has politico-economic liberalization affected financial allocation efficiency? Fresh African evidence," Economics Bulletin, AccessEcon, vol. 33(1), pages 663-676.

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    More about this item

    Keywords

    Banking; Democracy; Development; Finance; Politics;
    All these keywords.

    JEL classification:

    • E40 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - General
    • E50 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - General
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • P16 - Economic Systems - - Capitalist Systems - - - Political Economy of Capitalism
    • P50 - Economic Systems - - Comparative Economic Systems - - - General

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