Factors influencing the ability to honour debt repayment obligations by Governments in Africa

Abotsi, Anselm Komla

doi:10.1002/ijfe.2454

Cited by 4 publications

(2 citation statements)

References 29 publications

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“…They further asserted that there is growing empirical literature that confirms that insurance market development is a strong predictor of economic development across countries at different stages of development. Africa's growth model according to International Monetary Fund (2018) and cited in Abotsi (2021), continues to rely mostly on public expenditure, with low private investment. Ghana has been having unsustainable economic growth in the last two decades till recent times which has been blamed on many reasons such as over-reliance on primary exports which has unstable prices and other fiscal policies (Darko, 2015) .…”

Section: Background To the Studymentioning

confidence: 99%

Insurance and economic growth in Ghana

Osei-Bonsu

Abotsi

Carsamer³

2021

JEAS

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PurposeThe Ghanaian insurance industry has been transformed significantly from state-led to a market-driven one over the past decades. The empirical literature on the causal relationship between insurance and economic growth has been mixed, but little study on this has been done in Ghana. This study therefore empirically examines the effect of the growing insurance industry on the economic growth in Ghana.Design/methodology/approachQuantitative research design was deployed in the study. The study used Johansen–Juselius cointegration test and vector error correction model. The study deployed quarterly data from the first quarter of 2006 to the second quarter of 2018 sourced from the World Bank (World Development Indicators), National Insurance Commission, Ghana Statistical Service and Bank of Ghana.FindingsFindings revealed that there is a significant and positive short and long-run relationship between insurance and economic growth in Ghana, bidirectional causality between insurance and economic growth and also a long-run effect of innovations (shocks) in insurance on economic growth.Research limitations/implicationsOne of the limitations of the study is the unavailability of quarterly data of some of the variables.Practical implicationsThe study recommends the development and implementation of policies that promote an increase in coverage and access to insurance products to enhance economic growth.Originality/valueThe study finds a bidirectional causality running from insurance premium to economic growth and from economic growth to insurance which is consistent with the feedback hypothesis in the case of Ghana. Impulse response functions and the variance decompositions revealed that innovation (shock) in the insurance industry has a positive impact on economic growth.

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Section: Background To the Studymentioning

confidence: 99%

Insurance and economic growth in Ghana

Osei-Bonsu

Abotsi

Carsamer³

2021

JEAS

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“…Optimising government spending is characterised by a crowding-in effect with economic growth (Afonso & Leal, 2020;Alshammary et al, 2020). In a similar vein, the study conducted by Abotsi (2021) utilised a panel comprising 95 countries to examine the correlation between fiscal policy and investment over the period spanning from 1970 to 2008. The outcome of the study suggests that government expenditure and economic growth are intertwined.…”

Section: Literature Reviewmentioning

confidence: 99%

Government Expenditure and Economic Growth Nexus in Ghana

Bathuure

2024

IJECOP

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Purpose: Economic growth is widely regarded as a crucial indicator of economic advancement within a nation, as it has significant implications for the provision of state benefits, the improvement of living standards, and the generation of employment opportunities. The present study employed a time series analysis spanning from 1983 to 2018, focusing on Ghana, in order to comprehensively examine the diverse impact of both aggregate and disaggregated government expenditure and debt on the country's economic growth. Methodology: The study conducted initial examinations, including unit root tests, cointegration tests, and correlation matrices, to determine the statistical reliability and validity of the data series for the research. The long-run parameters were estimated using the two-stage least square regression method, the autoregressive distributed lag method, and the threshold regression method. Findings: Based on our research, it has been determined that government expenditure exerts a positive and statistically significant influence on overall economic growth. However, when examining the disaggregated effects, it becomes evident that consumption expenditure has a positive and significant impact on economic growth, whereas capital expenditure has a negative effect on economic growth. Unique Contribution to Theory, Practice and Policy (Recommendations): In relation to the prevailing economic conditions characterised by periods of prosperity or recession, it is evident that the government should prioritise its attention towards external debt rather than domestic debt during times of economic expansion. Moreover, during periods of economic downturn, it is imperative for the government to prioritise foreign direct investment as a means of financing its budget, rather than relying on debt

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Fiscal policy sustainability and public debt in Africa

Abotsi

2023

SN Bus Econ

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Factors influencing the ability to honour debt repayment obligations by Governments in Africa

Cited by 4 publications

References 29 publications

Insurance and economic growth in Ghana

Insurance and economic growth in Ghana

Government Expenditure and Economic Growth Nexus in Ghana

Fiscal policy sustainability and public debt in Africa

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