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Article
Publication date: 12 October 2018

Simplice Asongu, Sara le Roux, Jacinta C. Nwachukwu and Chris Pyke

The purpose of this paper is to present theoretical and empirical arguments for the role of mobile telephony in promoting good governance in 47 sub-Saharan African…

Abstract

Purpose

The purpose of this paper is to present theoretical and empirical arguments for the role of mobile telephony in promoting good governance in 47 sub-Saharan African countries for the period 2000–2012.

Design/methodology/approach

The empirical inquiry uses an endogeneity-robust GMM approach with forward orthogonal deviations to analyze the linkage between mobile phone usage and the variation in three broad governance categories – political, economic and institutional.

Findings

Three key findings are established: first, in terms of individual governance indicators, mobile phones consistently stimulated good governance by the same magnitude, with the exception of the effect on the regulation component of economic governance. Second, when indicators are combined, the effect of mobile phones on general governance is three times higher than that on the institutional governance category. Third, countries with lower levels of governance indicators are catching-up with their counterparts with more advanced dynamics.

Originality/value

The study makes both theoretical and empirical contributions by highlighting the importance of various combinations of governance indicators and their responsiveness to mobile phone usage.

Details

Information Technology & People, vol. 32 no. 4
Type: Research Article
ISSN: 0959-3845

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Article
Publication date: 5 February 2018

Simplice A. Asongu and Jacinta C. Nwachukwu

The purpose of this paper is to assess the correlations between mobile banking and inclusive development (poverty and inequality) in 93 developing countries for the year 2011.

Abstract

Purpose

The purpose of this paper is to assess the correlations between mobile banking and inclusive development (poverty and inequality) in 93 developing countries for the year 2011.

Design/methodology/approach

Mobile banking entails the following: “mobile phones used to pay bills” and “mobile phones used to receive/send money”, while the modifying policy indicator includes the human development index (HDI). The data are decomposed into seven sub-panels based on two fundamental characteristics: regions (Latin America, Asia and the Pacific, Central and Eastern Europe, and Middle East and North Africa) and income levels (upper middle income, lower middle income and low income).

Findings

The results show that at certain thresholds of the HDI, mobile banking is positively linked to inclusive development. The following specific findings are established. First, the increased use of mobile phones to pay bills is negatively correlated with: poverty in lower-middle-income countries (LMIC), upper-middle-income countries (UMIC) and Latin American (LA) countries, respectively, at HDI thresholds of 0.725, 0.727 and 0.778 and inequality in UMIC and LA with HDI thresholds of, respectively, 0.646 and 0.761. Second, the increased use of mobile phones to send/receive money is negatively correlated with: poverty in LMIC, UMIC and Central and Eastern European (CEE) countries with corresponding HDI thresholds of 0.631, 0.750 and 0.750 and inequality in UMIC, CEE and LA at HDI thresholds of 0.665, 0.736 and 0.726, respectively.

Practical implications

The findings are discussed in the light of current policy challenges in the transition from the UN’s Millennium Development Goals to Sustainable Development Goals.

Originality/value

The authors have exploited the only macroeconomic data on mobile banking currently available.

Details

Information Technology & People, vol. 31 no. 1
Type: Research Article
ISSN: 0959-3845

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Article
Publication date: 11 May 2018

Venessa S. Tchamyou, Simplice A. Asongu and Jacinta C. Nwachukwu

The purpose of this paper is to investigate the effects of information asymmetry (between the realized return and the expected return) on market timing in the mutual fund industry.

Abstract

Purpose

The purpose of this paper is to investigate the effects of information asymmetry (between the realized return and the expected return) on market timing in the mutual fund industry.

Design/methodology/approach

For the purpose, the authors use a panel of 1,488 active open-end mutual funds for the period 2004-2013. The authors use fund-specific time-dynamic betas. The information asymmetry is measured as the standard deviation of idiosyncratic risk. The data set is decomposed into five market fundamentals in order to emphasis the policy implications of the findings with respect to: equity, fixed income, allocation, alternative, and tax-preferred mutual funds. The empirical evidence is based on endogeneity-robust difference and system generalized method of moments.

Findings

The following findings are established. First, the information asymmetry broadly follows the same trend as volatility, with a higher sensitivity to market risk exposure. Second, fund managers tend to raise (cutback) their risk exposure in time of high (low) market liquidity. Third, there is evidence of convergence in equity funds. The authors may, therefore, infer that equity funds with lower market risk exposure are catching-up with their counterparts with higher exposure to fluctuation in market conditions.

Originality/value

The paper complements the sparse literature on market timing in the mutual fund industry with time-dynamic betas, information asymmetry and an endogeneity-robust empirical approach.

Details

International Journal of Managerial Finance, vol. 14 no. 5
Type: Research Article
ISSN: 1743-9132

Keywords

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Article
Publication date: 5 February 2018

Simplice A. Asongu and Jacinta C. Nwachukwu

The purpose of this paper is to examine how information and communication technology (ICT) influences openness to improve the conditions of doing business in sub-Saharan Africa.

Abstract

Purpose

The purpose of this paper is to examine how information and communication technology (ICT) influences openness to improve the conditions of doing business in sub-Saharan Africa.

Design/methodology/approach

The data were collected for the period 2000-2012. ICT is proxied with internet and mobile phone penetration rates whereas openness is measured in terms of financial and trade globalisation. Ten indicators of doing business are used, namely: cost of business start-up procedures; procedure to enforce a contract; start-up procedures to register a business; time required to build a warehouse; time required to enforce a contract; time required to register a property; time required to start a business; time to export; time to prepare and pay taxes; and time to resolve an insolvency. The empirical evidence is based on generalised method of moments with forward orthogonal deviations.

Findings

While the authors find substantial evidence that ICT complements openness to improve conditions for entrepreneurship, the effects are contingent on the dynamics of openness, ICT and entrepreneurship. Theoretical and practical policy implications are discussed.

Originality/value

The inquiry is based on two contemporary development concerns: the need for policy to leverage on the ICT penetration potential in the sub-region and the relevance of entrepreneurship in addressing associated issues of population growth such as unemployment.

Details

Information Technology & People, vol. 31 no. 1
Type: Research Article
ISSN: 0959-3845

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Article
Publication date: 11 January 2016

Simplice A. Asongu and Jacinta C. Nwachukwu

Education as a weapon in the fight against conflict and violence remains widely debated in policy and academic circles. Against the background of growing political…

Abstract

Purpose

Education as a weapon in the fight against conflict and violence remains widely debated in policy and academic circles. Against the background of growing political instability in Africa and the central role of the knowledge economy in twenty-first century development, this paper provides three contributions to existing literature. The purpose of this paper is to assess how political stability/non-violence is linked to the incremental, synergy and lifelong learning effects of education.

Design/methodology/approach

The authors define lifelong learning as the combined knowledge acquired during primary, secondary and tertiary education. Principal component analysis is used to reduce the dimensions of educational and political indicators. An endogeneity robust dynamic system Generalized Methods of Moments is used for the estimations.

Findings

The authors establish three main findings. First, education is a useful weapon in the fight against political instability. Second, there is an incremental effect of education in the transition from secondary to tertiary schools. Third, lifelong learning also has positive and synergy effects. This means that the impact of lifelong learning is higher than the combined independent effects of various educational levels. The empirical evidence is based on 53 African countries for the period 1996-2010.

Practical implications

A plethora of policy implications are discussed, inter alia: how the drive towards increasing the knowledge economy through lifelong learning can be an effective tool in the fight against violence and political insurgency in Africa.

Originality/value

As the continent is nursing knowledge economy ambitions, the paper is original in investigating the determinants of political stability/non-violence from three dimensions of education attainment: the incremental, the lifelong learning and a synergy effect.

Details

Journal of Economic Studies, vol. 43 no. 1
Type: Research Article
ISSN: 0144-3585

Keywords

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Article
Publication date: 7 March 2019

Simplice Asongu, Sara le Roux, Jacinta Nwachukwu and Chris Pyke

The purpose of this paper is to investigate loan price and quantity effects of information sharing offices with information and communication technology (ICT), in a panel…

Abstract

Purpose

The purpose of this paper is to investigate loan price and quantity effects of information sharing offices with information and communication technology (ICT), in a panel of 162 banks consisting of 42 African countries for the period 2001–2011.

Design/methodology/approach

The empirical evidence is based on a panel of 162 banks in 42 African countries for the period 2001–2011. Misspecification errors associated with endogenous variables and unobserved heterogeneity in financial access are addressed with generalized method of moments and instrumental quantile regressions.

Findings

The findings uncover several major themes. First, ICT when integrated with the role of public credit registries significantly lowered the price of loans and raised the quantity of loans. Second, while the net effects from the interaction of ICT with private credit bureaus (PCBs) do not improve financial access, the corresponding marginal effects show that ICT could complement the characteristics of PCBs to reduce loan prices and increase loan quantity, but only when certain thresholds of ICT are attained. The authors compute and discuss the policy implications of these ICT thresholds for banks with low, intermediate and high levels of financial access.

Originality/value

This is one of the few studies to assess how the growing ICT can be leveraged in order to reduce information asymmetry in the banking industry with the ultimate aim of improving financial access in a continent where lack of access to finance is a critical policy syndrome.

Details

International Journal of Managerial Finance, vol. 15 no. 2
Type: Research Article
ISSN: 1743-9132

Keywords

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Article
Publication date: 2 August 2019

Simplice Asongu, Jacinta Nwachukwu and Sara le Roux

The purpose of this paper is to investigate the role of inclusive human development and military expenditure in modulating the effect of terrorism on governance.

Abstract

Purpose

The purpose of this paper is to investigate the role of inclusive human development and military expenditure in modulating the effect of terrorism on governance.

Design/methodology/approach

It is based on 53 African countries for the period 1998–2012 and interactive generalised method of moments is employed. Six governance indicators from the World Bank and two terrorism variables are used, namely, domestic and transnational terrorism dynamics.

Findings

The following main findings are established. There is a negative net effect on governance (regulation quality and corruption-control) when inclusive human development is used to reduce terrorism. There is a positive net impact on governance (voice and accountability and rule of law) when military expenditure is used to reduce domestic terrorism.

Originality/value

The authors have complemented the sparse literature on the use of policy variables to mitigate the effect of policy syndromes on macroeconomic outcomes.

Details

Journal of Economic Studies, vol. 46 no. 3
Type: Research Article
ISSN: 0144-3585

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Article
Publication date: 6 November 2017

Simplice Asongu and Jacinta Nwachukwu

The purpose of this study is to examine the role of reducing information asymmetry (IA) on conditional financial sector development in 53 African countries for the period…

Abstract

Purpose

The purpose of this study is to examine the role of reducing information asymmetry (IA) on conditional financial sector development in 53 African countries for the period 2004-2011.

Design/methodology/approach

The empirical evidence is based on contemporary and non-contemporary quantile regressions. Instruments for reducing IA include public credit registries (PCRs) and private credit bureaus (PCBs). Hitherto unexplored dimensions of financial sector development are used, namely, financial sector dynamics of formalization, informalization, semi-formalization and non-formalization.

Findings

The following findings are established. First, the positive (negative) effect of information sharing offices (ISO) on formal (informal) financial development is consistent with theory. Second, ISOs consistently increase formal financial development, with the incidence of PCRs higher in terms of magnitude, and financial sector formalization, with the impact of PCBs higher for the most part. Third, only PCBs significantly decrease informal financial development and both ISOs decrease financial sector informalization. Policy implications are discussed.

Originality/value

The study assesses the effect of reducing IA on financial development when existing levels of it matter because current studies based on mean values of financial development provide blanket policy implications which are unlikely to be effective unless they are contingent on prevailing levels of financial development and tailored differently across countries with high, intermediate and low initial levels of financial development.

Details

Journal of Financial Economic Policy, vol. 9 no. 4
Type: Research Article
ISSN: 1757-6385

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Article
Publication date: 26 February 2018

Simplice Asongu and Jacinta Nwachukwu

The purpose of this paper is to investigate how bank size affects the role of information asymmetry on financial access in a panel of 162 banks in 39 African countries for…

Abstract

Purpose

The purpose of this paper is to investigate how bank size affects the role of information asymmetry on financial access in a panel of 162 banks in 39 African countries for the period 2001-2011.

Design/methodology/approach

The empirical evidence is based on instrumental variable fixed effects regressions with overlapping and non-overlapping bank size thresholds to control for the quiet life hypothesis (QLH). The QLH postulates that managers of large banks will use their privileges for private gains at the expense of making financial services more accessible to the general public. Financial access is measured with loan price and loan quantity whereas information asymmetry is implicit in the activities of public credit registries and private credit bureaus.

Findings

The findings with non-overlapping thresholds are broadly consistent with those that are conditional on overlapping thresholds. First, public credit registries have a decreasing effect on the price of loans with the magnitude of reduction comparable across all bank size thresholds. Second, both public credit registries and private credit bureaus enhance the quantity of loans. Third, compared with public credit registries, private credit bureaus have a greater influence in increasing financial access because they have a significantly higher favorable effect on the quantity and price of loans Fourth, the QLH is not apparent because large banks are not associated with lower levels of financial access compared to small banks.

Originality/value

Studies of public credit registries and private credit bureaus in Africa are sparse. This is one of the few to assess linkages between bank size, information asymmetry and financial access.

Details

International Journal of Managerial Finance, vol. 14 no. 2
Type: Research Article
ISSN: 1743-9132

Keywords

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Article
Publication date: 8 May 2019

Simplice Asongu, Jacinta Nwachukwu, Stella-Maris Orim and Chris Pyke

The purpose of this paper is to complement the scant macroeconomic literature on the development outcomes of social media by examining the relationship between Facebook…

Abstract

Purpose

The purpose of this paper is to complement the scant macroeconomic literature on the development outcomes of social media by examining the relationship between Facebook penetration and violent crime levels in a cross-section of 148 countries for the year 2012.

Design/methodology/approach

The empirical evidence is based on ordinary least squares (OLS), Tobit and quantile regressions. In order to respond to policy concerns on the limited evidence on the consequences of social media in developing countries, the data set is disaggregated into regions and income levels. The decomposition by income levels included: low income, lower middle income, upper middle income and high income. The corresponding regions include: Europe and Central Asia, East Asia and the Pacific, Middle East and North Africa (MENA), Sub-Saharan Africa and Latin America.

Findings

From OLS and Tobit regressions, there is a negative relationship between Facebook penetration and crime. However, quantile regressions reveal that the established negative relationship is noticeable exclusively in the 90th crime quantile. Further, when the data set is decomposed into regions and income levels, the negative relationship is evident in the MENA while a positive relationship is confirmed for Sub-Saharan Africa. Policy implications are discussed.

Originality/value

Studies on the development outcomes of social media are sparse because of a lack of reliable macroeconomic data on social media. This study primarily complemented three existing studies that have leveraged on a newly available data set on Facebook.

Details

Information Technology & People, vol. 32 no. 5
Type: Research Article
ISSN: 0959-3845

Keywords

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