Financial sector competition and knowledge economy: evidence from SSA and MENA countries

Simplice A, Asongu (2012): Financial sector competition and knowledge economy: evidence from SSA and MENA countries. Forthcoming in:

Abstract

The goal of this paper is to assess how financial sector competition plays out in the development of knowledge economy (KE). It contributes at the same time to the macroeconomic literature on measuring financial development and response to the growing field of KE by means of informal sector promotion, micro finance and mobile banking. It suggests a practicable way to disentangle the effects of various financial sectors on different components of KE. The variables identified under the World Bank’s four knowledge economy index (KEI) are employed. Three hypotheses based on seven propositions are tested. Results show: (1) the informal financial sector, a previously missing component in the definition of the financial system by the IMF significantly affects KE dimensions; (2) disentangling different components of the existing measurement of the financial system improves dynamics in the KE-finance nexus and; (3) introduction of measures of sector importance provides relevant new insights into how financial sector competition affects KE.

• Item Type: MPRA Paper
• Language: English
• Keywords: Financial development; Knowledge Economy
• Subjects: P - Economic Systems > P0 - General > P00 - General; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O10 - General; O - Economic Development, Innovation, Technological Change, and Growth > O3 - Innovation ; Research and Development ; Technological Change ; Intellectual Property Rights > O34 - Intellectual Property and Intellectual Capital; P - Economic Systems > P4 - Other Economic Systems > P48 - Political Economy ; Legal Institutions ; Property Rights ; Natural Resources ; Energy ; Environment ; Regional Studies; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages

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