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Institutions and venture capital market development in sub‐Saharan Africa

Author

Listed:
  • Ebenezer Boateng
  • Peterson Owusu Junior
  • John G. Gatsi
  • Adam M. Anokye
  • Mac Junior Abeka
  • Emmanuel Asafo‐Adjei

Abstract

We investigate the critical interplay between economic institutions and political institutions and assess their influence on venture capital market development in sub‐Saharan Africa (SSA). To address endogeneity concern in our model specification, the two‐step system generalised method of moments was employed on a sample of 34 SSA countries from 2007 to 2018. The findings reveal that strengthening disaggregated measures of economic institutions, comprising legal system and property rights, size of government, sound money, regulations, and freedom to trade internationally spur venture capital market development in SSA. Finally, the evidence indicates that political institutions condition the influence of economic institutions on venture capital market development. The implications for policy are further discussed.

Suggested Citation

  • Ebenezer Boateng & Peterson Owusu Junior & John G. Gatsi & Adam M. Anokye & Mac Junior Abeka & Emmanuel Asafo‐Adjei, 2024. "Institutions and venture capital market development in sub‐Saharan Africa," Journal of International Development, John Wiley & Sons, Ltd., vol. 36(2), pages 1381-1406, March.
    • Handle: RePEc:wly:jintdv:v:36:y:2024:i:2:p:1381-1406
    DOI: 10.1002/jid.3864
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