The Mobile Phone, Information Sharing, and Financial Sector Development in Africa: a Quantile Regression Approach
This study investigates linkages between the mobile phone, information sharing offices (ISO), and financial sector development in 53 African countries for the period 2004–2011. ISO are private credit bureaus and public credit registries. The empirical evidence is based on contemporary and non-contemporary quantile regressions. Two main hypotheses are tested: mobile phones complement ISO to enhance the formal financial sector (hypothesis 1) and mobile phones complement ISO to reduce the informal financial sector (hypothesis 2). The hypotheses are largely confirmed. This research adds to the existing body of literature by engaging hitherto unexplored dimensions of financial sector development and investigating the role of mobile phones in information sharing for financial sector development.
KeywordsInformation sharing Banking sector development Africa
JEL ClassificationG20 G29 L96 O40 O55
The authors are indebted to the editor and reviewers for constructive comments.
- Adeusi, S. O., Azeez, B. A., & Olanrewaju, H. A. (2012). The effect of financial liberalization on the performance of informal capital market. Research Journal of Finance and Accounting, 3(6), 1–16.Google Scholar
- Agoba, A. M., Abor, J., Osei, K. A., & Sa-Aadu, J. (2019). Do independent central banks exhibit varied behaviour in election and non-election years: the case of fiscal policy in Africa. Journal of African Business, 1–21. https://doi.org/10.1080/15228916.2019.1584263.
- Aryeetey, E. (2005). Informal finance and private sector development in Africa. Journal of Microfinance, 7(1), 13–37.Google Scholar
- Asongu, S. A. (2012a). Law and finance in Africa. Brussels Economic Review, 55(4), 385–408.Google Scholar
- Asongu, S. A., & Biekpe, N. (2017). ICT, information asymmetry and market power in African banking industry. Research in International Business and Finance, 44(April), 518–531.Google Scholar
- Asongu, S. A., & Odhiambo, N. M. (2019a). Basic formal education quality, information technology, and inclusive human development in sub-Saharan Africa. Sustainable Development. https://doi.org/10.1002/sd.1914.
- Asongu, S. A., & Odhiambo, N. M. (2019b). How enhancing information and communication technology has affected inequality in Africa for sustainable development: an empirical investigation. Sustainable Development. https://doi.org/10.1002/sd.1929.
- Asongu, S. A., & Odhiambo, N. M. (2019c). Economic development thresholds for a green economy in sub-Saharan Africa. Energy Exploration & Exploitation., 014459871983559. https://doi.org/10.1177/0144598719835591.
- Asongu, S. A., & Tchamyou, V. S. (2019). Human capital, knowledge creation, knowledge diffusion, institutions and economic incentives: South Korea versus Africa. Contemporary Social Science., 1–22. https://doi.org/10.1080/21582041.2018.1457170.
- Asongu, S. A., Anyanwu, J. C., & Tchamyou, S. V. (2016a). Information sharing and conditional financial development in Africa, African Governance and Development Institute Working Paper No. 16/001, Yaoundé.Google Scholar
- Asongu, S. A., Nwachukwu, J. C., & Pyke, C. (2019a). The right to life: global evidence on the role of security officers and the police in modulating the effect of insecurity on homicide. Social Indicators Research. https://doi.org/10.1007/s11205-018-1992-2.
- Breitung, J. (2000). The local power of some unit root tests for panel data. Advances in, The local power of some unit root tests for panel data Econometrics. In B. H. Baltagi (Ed.), Nonstationary Panels, Panel Cointegration, and Dynamic Panels (Vol. 15, pp. 161–178). Amsterdam: JAY Press.CrossRefGoogle Scholar
- Claus, I., & Grimes, A. (2003). Asymmetric information, financial intermediation and the monetary transmission mechanism: a critical review, NZ Treasury Working Paper No. 13/019, Wellington.Google Scholar
- Coccorese, P., & Pellecchia, A. (2010). Testing the ‘quiet life’ hypothesis in the Italian banking industry. Economic Notes by Banca dei Paschi di Siena SpA, 39(3), 173–202.Google Scholar
- Demombynes, G., & Thegeya, A. (2012). Kenya’s mobile revolution and the promise of mobile savings. World Bank Policy Research Working Paper, No. 5988, Washington.Google Scholar
- Do, Q. T., & Levchenko, A. A. (2004). Trade and financial development, World Bank Policy Research Working Paper No. 3347, Washington.Google Scholar
- Easterly, W. (2005). What did structural adjustment adjust? The association of policies and growth with repeated IMF and World Bank adjustment loans. Journal of Development Economics, 76(1), 1–22.Google Scholar
- Fouda, O. J. P. (2009). The excess liquidity of banks in Franc zone: how to explain the. paradox in the CEMAC. Revue Africaine de l’Integration, 3(2), 1–56.Google Scholar
- Galindo, A., & Miller, M. (2001). Can credit registries reduce credit constraints? empirical evidence on the role of credit registries in firm investment decisions, Inter-American Development Bank Working Paper, Washington.Google Scholar
- Huang, Y. (2005). What determines financial development?, Bristol University, Discussion Paper No. 05/580, Bristol.Google Scholar
- Huang, Y., & Temple, J. R. W. (2005). Does external trade promote financial development? CEPR Discussion Paper No. 5150, London.Google Scholar
- IMF. (2008). International Financial Statistics Yearbook, 2008. Washington: IMF Statistics Department.Google Scholar
- Levine, R. (1997). Financial development and economic growth: views and agenda. Journal of Economic Literature, 35(2), 688–726.Google Scholar
- Love, I., & Mylenko, N. (2003). Credit reporting and financing constraints, World Bank Policy Research Working Paper Series No. 3142, Washington.Google Scholar
- Meagher, K. (2013). Unlocking the informal economy: a literature review on linkages between formal and informal economies in the developing countries, WIEGO Working Paper No. 27, Manchester.Google Scholar
- Penard, T., Poussing, N., Yebe, G. Z., & Ella, P. N. (2012). Comparing the determinants of internet and cell phone use in Africa: evidence from Gabon. Communications & Strategies, 86(2), 65–83.Google Scholar
- Saxegaard, M. (2006). Excess liquidity and effectiveness of monetary policy: evidence from.sub-Saharan Africa, IMF Working Paper No. 06/115, Washington.Google Scholar
- Singh, R. J, Kpodar, K., & Ghura, D. (2009). Financial deepening in the CFA zone: the role of institutions, IMF Working Paper No. 09/113, Washington.Google Scholar
- Stiglitz, J. E., & Weiss, A. (1981). Credit rationing in markets with imperfect Information. The American Economic Review, 71(3), 393–410.Google Scholar
- Tanjung, Y. S., Marciano, D., & Bartle, J. (2010). “Asymmetry information and diversification effect on loan pricing in Asia Pacific Region 2006-2010”, Faculty of Business & Economics, University of Surabaya.Google Scholar
- Tchamyou, V. S. (2019a). The role of information sharing in modulating the effect of financial access on inequality. Journal of African Business. https://doi.org/10.1080/15228916.2019.1584262.
- Tchamyou, V. S. (2019b). Education, lifelong learning, inequality and financial access: evidence from African countries. Contemporary Social Science. https://doi.org/10.1080/21582041.2018.1433314.
- Triki, T., & Gajigo, O. (2014). Credit bureaus and registries and access to finance: new evidence from 42 African countries. Journal of African Development, 16(2), 73–101.Google Scholar