Un réexamen de la non-linéarité entre le développement financier et la croissance économique

Eggoh, Jude; Villieu, Patrick

doi:10.3917/redp.232.0211

Cited by 10 publications

(16 citation statements)

References 25 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…The existence of multiple equilibrium is confirmed by Eggoh and Villieu (2013) [26], Dontsi and Megnigang (2022) [25]. They highlight two stable equilibrium, the first characterized by an underdeveloped financial sector and low growth, and the second by a developed financial sector and high growth.…”

Section: Theoretical Work On Non-linear Relationshipmentioning

confidence: 80%

Financial System Development and Economic Growth: A Critical Analysis of the Literature

Megnigang

2024

JWER

View full text Add to dashboard Cite

Any developing countries (DCs) want to achieve strong, sustained growth to ensure their sustainable development by 2030. Indeed, promoting economic growth is one of the targets of the majority of the Sustainable Development Goals (SDGs) set by United Nations member countries. In their agenda, financial system development cited as an effective means of enabling developing countries to achieve high rates economic growth. However, research into the relationship between finance and growth has produced controversial results, showing that financial development is not always conducive to economic growth. These non-consensual findings call for further research into the subject. With this in mind, the aim of this paper is to critically analyze the literature on the subject with reference to the characteristics of developing countries. We have used the stylistic facts observed in these countries to see whether the way in which studies are conducted is in line with reality. These facts revealed that, as conducted, theoretical and empirical work does not really illustrate the nature of this relationship in the case of developing countries. The authors do not take into account certain specificities of these countries. The studies focus mainly on the formal financial sector, whereas in developing countries, the majority of the population is unbanked, so they tend to turn to the informal financial sector for savings and credit. In Pagano's theoretical model, on which most empirical work is based, the efficiency of financial intermediation is assumed to be an exogenous variable. However, in developing countries, many factors influence this function: poor governance, prevailing corruption, inefficiency of the legal system, government intervention in the financial sector, culture of non-repayment. Banking sector development is generally captured by credit to the private sector. However, in developing countries, the majority of bank credit is allocated to large commercial enterprises that sell mainly imported products. The indicators generally used to capture financial markets development do not reflect the amount of financing actually obtained by listed companies. Rather, they measure the level of secondary market activity, whose mission is to ensure the liquidity of securities and determine their prices. Taking account of financial dualism and integrating factors linked to the institutional environment, borrower behavior and financial intermediaries into the resource allocation function would be a significant advance in the literature.

show abstract

Section: Theoretical Work On Non-linear Relationshipmentioning

confidence: 80%

Financial System Development and Economic Growth: A Critical Analysis of the Literature

Megnigang

2024

JWER

View full text Add to dashboard Cite

show abstract

Section: Robustness Analysis Of the Results Obtained With A Gmm Modelmentioning

confidence: 99%

The Non-Linear Effects of Fixed Broadband on Economic Growth in Africa

Kouam¹,

Asongu

2022

SSRN Journal

View full text Add to dashboard Cite

“…The GMM estimation shows that the sign of the variable is negative while it is positive when the variable is squared; this reflects the existence of a U-shaped relationship between the number of subscriptions to high-speed Internet services and economic growth in Africa. The insignificance of the variable of interest and its squared series on the one hand and, of some control variables on the other hand, lies in the fact that GMM modeling leads to a loss of information related to the linearity constraint that the quadratic model imposes on the marginal effect (Eggoh and Villieu, 2013). Moreover, given that the GMM technique is employed exclusively as a robustness check, the computation of the total effect of fixed broadband as in corresponding literature (Emara, 2022) is not indispensable because the GMM results inform the study of the presence of a non-linear nexus between fixed broadband and economic growth.…”

Section: Empirical Analysismentioning

confidence: 99%

The non-linear effects of fixed broadband on economic growth in Africa

Kouam¹,

Asongu

2022

JES

View full text Add to dashboard Cite

PurposeThe study assesses the non-linear nexus between fixed broadband and economic growth. The study focuses on data from 33 African countries for the period 2010 to 2020.Design/methodology/approachThe empirical evidence is based on unit root tests, panel smooth transition regression and the generalized method of moments.FindingsThe following findings are established in this study. (1) The proportion of the population with access to electricity above and below which the relationship between fixed broadband and economic growth changes in sign is about 60%. (2) Below this threshold, each 1% increase in fixed broadband subscriptions induces a decline in economic growth of about 2.58%. Above the threshold, economic growth would increase by 2.43% when fixed broadband subscriptions increase by 1%. Sensitivity analyses and generalized method of moments (GMM) estimation show that these results are robust.Practical implicationsDue to the coronavirus disease (COVID-19) pandemic, which requires countries to take adequate measures to curb the spread of the pandemic, especially by means of virtual economic activities, any national policy aiming at improving the access of populations to high levels of fixed broadband services should be preceded by the implementation of an electrification program for at least 60% of the total population. Otherwise, providing a good quality internet connection for the benefit of the population would not produce the expected effects on economic growth and would, therefore, be counterproductive.Originality/valueThis study complements the extant literature by providing thresholds at which fixed broadband affects economic growth.

show abstract

Un réexamen de la non-linéarité entre le développement financier et la croissance économique

Cited by 10 publications

References 25 publications

Financial System Development and Economic Growth: A Critical Analysis of the Literature

Financial System Development and Economic Growth: A Critical Analysis of the Literature

The Non-Linear Effects of Fixed Broadband on Economic Growth in Africa

The non-linear effects of fixed broadband on economic growth in Africa

Contact Info

Product

Resources

About