Abstract
Sequel to the fact that technology is critical in driving developing nations’ growth process, we analyse its mediating impact in the nexus between financial development and output growth. The study covers the period between 1990 and 2019 across 46 African nations using the dynamic heterogeneous panel. The empirical result reveals that financial development exerts a positive but insignificant long-run influence on Africa’s growth while its short-run effect is negative but significant. It also confirms that technology exerts a positive and substantial effect on long run output growth in Africa while it is insignificantly positive over the short run. In addition, evidence reveals that technology is a vital growth stimulator owing to its long-run growth-enhancing impact while interacting with the financial sector. Finally, the result shows a feedback effect between output growth and financial development and technology and the financial sector. Therefore, we recommend appropriate policies regarding the incorporation of high technological inputs.
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The data that support the findings of this study are available from the corresponding author upon reasonable request.
Notes
Algeria, Angola, Burkina Faso, Gambia, Cape Verde, Botswana, Burundi, Benin, Chad, Congo, Cameroon, Cote d'Ivoire, Comoros, Central African Republic (CAR), Guinea-Bissau, Eritrea, Ethiopia, Mauritius, Egypt, Equatorial Guinea, Guinea, Gabon, Libya, Morocco, Ghana, Mauritania, Mali, Lesotho, Liberia, Nigeria, Niger, Namibia, Senegal, Rwanda, Madagascar, Sierra Leone, Seychelles, Sudan, South Africa, Tanzania, Tunisia, Malawi, Zimbabwe, Zambia, Uganda, Togo.
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This research is partly funded by University of Economics Ho Chi Minh City, Vietnam. Grant No: IBR_RF207.
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Mesagan, E.P., Vo, X.V. & Emmanuel, P.M. The technological role in the growth-enhancing financial development: evidence from African nations. Econ Change Restruct 56, 657–680 (2023). https://doi.org/10.1007/s10644-022-09442-z
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DOI: https://doi.org/10.1007/s10644-022-09442-z