The Politics of Central Banking and Implications for Regulatory Reform in Sub-Saharan Africa: The Cases of Kenya, Nigeria and Uganda

Dafe, Florence

doi:10.2139/ssrn.2797222

Cited by 5 publications

(1 citation statement)

References 42 publications

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“…In contrast, the dependent Central Bank of Uganda was used by successive governments to finance the civil war (Brownbridge, 1998). Restructured in 2000, the Bank was able to resist political pressures and focus on financial stability and inflation control (Dafe, 2012).…”

Section: A Theory Of Central Bank Independence and Civil War Terminationmentioning

confidence: 99%

Central banks and civil war termination

Garriga

2021

Journal of Peace Research

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The ability to finance conflict likely affects the odds of sustaining a war and succeeding in it. Recent literature explores rebel group funding, but far less is known about how states finance their own war efforts. This article posits that the design of central banks should affect civil war termination. In particular, it argues that central bank independence affects civil war termination through two channels. First, financial markets consider central bank independence as a good signal in terms of macroeconomic stability and debt repayment. In this way, independent central banks enhance the ability of the government to access credit to finance and end a civil war. Second, central bank independence is associated with lower inflation. Inflation control reduces one source of additional grievances that the civil war may impose on citizens. On a sample of civil wars between 1975 and 2009, central bank independence is associated with a substantial increase in the likelihood of war termination. When the form of termination is disaggregated, (higher) central bank independence is associated with a higher probability of government victory, relative to continued conflict and to other outcomes. Additional tests provide support for the argued mechanisms: during civil wars, countries with more independent central banks access international credit markets in better conditions – i.e. they pay lower interest rates, and receive longer grace and maturity periods on new debt. Furthermore, in countries experiencing civil wars, central bank independence is associated with lower inflation.

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Section: A Theory Of Central Bank Independence and Civil War Terminationmentioning

confidence: 99%

Central banks and civil war termination

Garriga

2021

Journal of Peace Research

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The political economy of financial inclusion: tailoring donor policy to fit

Johnson

Williams

2016

Development Policy Review

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Financial inclusion has recently become a globally acclaimed policy objective. This provokes the need to review policy in this sector, particularly in light of the tensions that arise between donor approaches founded on market modernism and governments with more activist leanings. This is done here in the context of efforts to move donor development policy beyond 'best practice' institutional blue-prints to those which are 'good enough', which seek to understand underlying political economy dynamics in order to find space to engage with governments. In doing so, it is argued that there is scope for 'working with the grain' and harnessing the political economy of government policy in order to produce financial inclusion outcomes.

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Poverty, Politics and Local Diffusion - Resource Allocation in Bolivia’s Decentralized Social Fund

Faust

2012

SSRN Journal

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The Politics of Central Banking and Implications for Regulatory Reform in Sub-Saharan Africa: The Cases of Kenya, Nigeria and Uganda

Cited by 5 publications

References 42 publications

Central banks and civil war termination

Central banks and civil war termination

The political economy of financial inclusion: tailoring donor policy to fit

Poverty, Politics and Local Diffusion - Resource Allocation in Bolivia’s Decentralized Social Fund

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