Mobile money, ICT, financial inclusion and growth: How different is Africa?

Ahmad, Ahmad Hassan; Green, Christopher J.; Jiang, Fei; Murinde, Victor

Abstract

We investigate the contributions of fixed and mobile telecommunications (ICT) and mobile money to economic growth and financial inclusion in a 22-year panel of 146 countries. We extend the Solow growth model to include human capital, money, ICT, and mobile money, splitting the sample into sub-Saharan Africa (SSA) and the rest of the world (RoW) in addition to the whole sample analysis. We find mobile money affects economic growth through direct and indirect channels. Mobile money has a significant overall positive impact on growth, especially in countries with better mobile phone penetration and more dispersed populations. But its total quantitative effect is not large. Mobile money also tends to improve financial inclusion which in turn promotes growth. There are important differences between the SSA and RoW parameters, implying that the quantitative determinants of growth are different to some extent as between SSA and RoW.

Citation

Ahmad, A. H., Green, C. J., Jiang, F., & Murinde, V. (2023). Mobile money, ICT, financial inclusion and growth: How different is Africa?. Economic Modelling, 121, Article 106220. https://doi.org/10.1016/j.econmod.2023.106220

• Journal Article Type: Article
• Acceptance Date: Jan 26, 2023
• Online Publication Date: Feb 1, 2023
• Publication Date: Apr 1, 2023
• Deposit Date: Feb 6, 2023
• Journal: Economic Modelling
• Print ISSN: 0264-9993
• Electronic ISSN: 1873-6122
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 121
• Article Number: 106220
• DOI: https://doi.org/10.1016/j.econmod.2023.106220
• Keywords: ICT, Mobile, Financial inclusion, Africa
• Publisher URL: https://www.sciencedirect.com/science/article/abs/pii/S0264999323000329