Financial Access, Governance and Insurance Sector Development in Sub-Saharan Africa

Simplice Asongu and Nicholas Odhiambo

No 19/044, Research Africa Network Working Papers from Research Africa Network (RAN)

Abstract: Purpose –This study investigates the role of financial access in moderating the effect of governance on insurance consumption in 42 Sub-Saharan African countries using data for the period 2004-2014. Design/methodology/approach – Two life insurance indicators are used, notably: life insurance and non-life insurance. Six governance measurements are also used, namely: political stability, “voice & accountability†, government effectiveness, regulation quality, corruption-control and the rule of law. The empirical evidence is based on the Generalised Method of Moments (GMM) and Least Squares Dummy Variable Corrected (LSDVC) estimators. Findings –Estimations from the LSDVC are not significant while the following main findings are established from the GMM. First, financial access promotes life insurance through channels of political stability, “voice & accountability†, government effectiveness, the rule of law and corruption-control. Second, financial access also stimulates non-life insurance via governance mechanisms of political stability, “voice & accountability†, government effectiveness, regulation quality, the rule of law and corruption-control. Originality/value – This research complements the sparse literature on insurance promotion in Africa by engaging the hitherto unexplored role of financial access through governance channels.

Keywords: Insurance; Finance; Governance; Sub-Saharan Africa (search for similar items in EconPapers)
JEL-codes: G20 I28 I30 O16 O55 (search for similar items in EconPapers)
Pages: 30
Date: 2019-01
New Economics Papers: this item is included in nep-fdg and nep-ias
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Citations: View citations in EconPapers (18)

Forthcoming: Journal of Economic Studies

Downloads: (external link)
http://publications.resanet.org/RePEc/abh/abh-wpap ... b-Saharan-Africa.pdf Revised version, 2019 (application/pdf)

Related works:
Journal Article: Financial access, governance and insurance sector development in sub-Saharan Africa (2020)
Working Paper: Financial Access, Governance and Insurance Sector Development in Sub-Saharan Africa (2019)
Working Paper: Financial Access, Governance and Insurance Sector Development in Sub-Saharan Africa (2019)
Working Paper: Financial Access, Governance and Insurance Sector Development in Sub-Saharan Africa (2019)
Working Paper: Financial Access, Governance and Insurance Sector Development in Sub-Saharan Africa (2019)
Working Paper: Financial access, governance and insurance sector development in Sub-Saharan Africa (2019)
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