IDEAS home Printed from https://ideas.repec.org/a/taf/jsustf/v14y2024i3p675-688.html
   My bibliography  Save this article

Bank-based financial development and foreign direct investment in sub-Saharan African countries: a dynamic causal linkage

Author

Listed:
  • Nicholas M. Odhiambo

Abstract

In this paper, the causal relationship between financial development and foreign direct investment in sub-Saharan African (SSA) countries is examined. Three proxies of financial development, namely bank deposits, deposit money bank assets, and liquid liabilities have been used to examine this linkage. Using a multivariate panel Granger-causality model, the study found that the causal relationship between financial development and foreign direct investment is dependent on the variable used to measure the level of financial development. The relationship also varies over time. Overall, the study found a causal flow from FDI to financial development to predominate, at least in the short run. The study, therefore, recommends that policies aimed at attracting foreign direct investment inflows should be prioritised in SSA countries in the short run, in order to foster the development of the financial sector in the region.

Suggested Citation

  • Nicholas M. Odhiambo, 2024. "Bank-based financial development and foreign direct investment in sub-Saharan African countries: a dynamic causal linkage," Journal of Sustainable Finance & Investment, Taylor & Francis Journals, vol. 14(3), pages 675-688, July.
    • Handle: RePEc:taf:jsustf:v:14:y:2024:i:3:p:675-688
    DOI: 10.1080/20430795.2021.1879561
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/20430795.2021.1879561
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/20430795.2021.1879561?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:taf:jsustf:v:14:y:2024:i:3:p:675-688. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/TSFI20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.