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Financial Inclusion and Sustainable Growth in North African Firms: A Dynamic-Panel-Threshold Approach

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  • Wafa Khémiri

    (Department of Finance, École Supérieure de Commerce de Tunis, University of Manouba, LARIMRAF LR21ES29, Campus Universitaire Manouba, 2010 Manouba, Tunisia)

  • Ahmed Chafai

    (Department of Economics, École Supérieure de Commerce de Tunis, University of Manouba, ThÉMA LR16ES10, Campus Universitaire Manouba, 2010 Manouba, Tunisia)

  • Faizah Alsulami

    (Department of Accounting, Faculty of Business Administration, University of Tabuk, P.O. Box 741, Tabuk 71491, Saudi Arabia)

Abstract

This paper investigates the impact of financial inclusion on sustainable firm growth in Northern African countries (Egypt, Morocco, and Tunisia) during the period of 2007–2020. To this end, this study employs a dynamic panel threshold regression (DPTR) model. This model is a panel-data model that can capture different behaviors of data, depending on a threshold variable. The main results showed the existence of a threshold effect. This means that when financial inclusion is low (high), sustainable firm growth is limited (significant) due to the absence (presence) of appropriate financing, information, and financial tools. However, the levels of financial inclusion in North African countries are insufficient and require improvement. Therefore, it is essential for policymakers and managers to continue to promote the quality of financial inclusion by improving access to financial services and the regulatory environment to facilitate firms’ access to financing and support their sustainability.

Suggested Citation

  • Wafa Khémiri & Ahmed Chafai & Faizah Alsulami, 2023. "Financial Inclusion and Sustainable Growth in North African Firms: A Dynamic-Panel-Threshold Approach," Risks, MDPI, vol. 11(7), pages 1-19, July.
    • Handle: RePEc:gam:jrisks:v:11:y:2023:i:7:p:132-:d:1195767
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    References listed on IDEAS

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    2. Eman Fathi Attia & Hamsa hany Ezz Eldeen & Sameh said Daher, 2023. "Size-Threshold Effect in the Capital Structure–Firm Performance Nexus in the MENA Region: A Dynamic Panel Threshold Regression Model," Risks, MDPI, vol. 11(2), pages 1-13, January.
    3. Li, Na & Wu, Di, 2023. "Nexus between natural resource and economic development: How green innovation and financial inclusion create sustainable growth in BRICS region?," Resources Policy, Elsevier, vol. 85(PA).
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    6. Daud, Siti Nurazira Mohd & Ahmad, Abd Halim, 2023. "Financial inclusion, economic growth and the role of digital technology," Finance Research Letters, Elsevier, vol. 53(C).
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    Cited by:

    1. Yang Jingyi & Guo Xiaoyang & Zhang Xiuwu, 2024. "Analysis of the Effect of Digital Financial Inclusion in Promoting Inclusive Growth: Mechanism and Statistical Verification," Economics - The Open-Access, Open-Assessment Journal, De Gruyter, vol. 18(1), pages 1-18.
    2. Faizah Alsulami, 2024. "The Operational Risk Disclosure Threshold Effect in the Earnings Management–Sustainability Firm Performance Nexus in Saudi Arabia: A Dynamic Panel Threshold Regression Model," Sustainability, MDPI, vol. 16(10), pages 1-21, May.
    3. Wafa Khémiri & Eman Fathi Attia & Ahmed Chafai, 2024. "How Financial Inclusion Moderates the Curvilinear Nexus between Tangible Investment and Sustainable Firm Growth: New Evidence from the Middle East and North Africa Region," Sustainability, MDPI, vol. 16(6), pages 1-27, March.
    4. Abiodun F. Okunlola & Adewale R. Aregbeshola, 2023. "Re-Engineering Financial Resources through Development Finance in Africa: A Review of the Literature," Sustainability, MDPI, vol. 16(1), pages 1-19, December.

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