Is information diffusion a threat to market power for financial access? Insights from the African banking industry

Simplice Asongu; Enowbi Batuo; Jacinta Nwachukwu; Vanessa  Tchamyou

doi:10.1016/j.mulfin.2018.04.005

Is information diffusion a threat to market power for financial access? Insights from the African banking industry

Simplice Asongu, Enowbi Batuo, Jacinta Nwachukwu, Vanessa Tchamyou

School of Economics, Finance and Accounting

Research output: Contribution to journal › Article › peer-review

28 Citations (Scopus)

147 Downloads (Pure)

Abstract

This study assesses how information diffusion dampens the adverse effect of market power on the price and quantity of loans provided by a panel of 162 banks from 39 African countries for the period 2001-2011. First, from the Generalised Method of Moments results, a mobile phone penetration rate of 54.29, rising to 57 per 100 people are predicted to neutralise the adverse effect of market power on the average loan price and quantity respectively. Second, from the Quantile Regressions, mobile phone penetration rates of 56.20, 52.04 and 42.76 per 100 people is needed to nullify the negative effect of market power on loan quantity at the 10th decile, 25th quartile and 90th decile respectively. Third, a considerably lower internet penetration rate of 9.49 per 100 people is required to counteract the negative impact of market power on loan quantity at the 90th decile. Policy implications are discussed.

Original language	English
Pages (from-to)	88-104
Number of pages	17
Journal	Journal of Multinational Financial Management
Volume	45
Early online date	25 Apr 2018
DOIs	https://doi.org/10.1016/j.mulfin.2018.04.005
Publication status	Published - Jun 2018

Bibliographical note

NOTICE: this is the author’s version of a work that was accepted for publication in Journal of Multinational Financial Management.
Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Journal of Multinational Financial Management (2018) DOI:10.1016/j.mulfin.2018.04.005

Keywords

Financial access
Market power
Information asymmetry
ICT
Africa

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

Access to Document

10.1016/j.mulfin.2018.04.005

Post-PrintAccepted author manuscript, 1.06 MBLicence: CC BY-NC-ND

Cite this

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title = "Is information diffusion a threat to market power for financial access? Insights from the African banking industry",

abstract = "This study assesses how information diffusion dampens the adverse effect of market power on the price and quantity of loans provided by a panel of 162 banks from 39 African countries for the period 2001-2011. First, from the Generalised Method of Moments results, a mobile phone penetration rate of 54.29, rising to 57 per 100 people are predicted to neutralise the adverse effect of market power on the average loan price and quantity respectively. Second, from the Quantile Regressions, mobile phone penetration rates of 56.20, 52.04 and 42.76 per 100 people is needed to nullify the negative effect of market power on loan quantity at the 10th decile, 25th quartile and 90th decile respectively. Third, a considerably lower internet penetration rate of 9.49 per 100 people is required to counteract the negative impact of market power on loan quantity at the 90th decile. Policy implications are discussed. ",

keywords = "Financial access, Market power, Information asymmetry, ICT, Africa",

author = "Simplice Asongu and Enowbi Batuo and Jacinta Nwachukwu and Vanessa Tchamyou",

note = "NOTICE: this is the author{\textquoteright}s version of a work that was accepted for publication in Journal of Multinational Financial Management. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Journal of Multinational Financial Management (2018) DOI:10.1016/j.mulfin.2018.04.005 ",

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doi = "10.1016/j.mulfin.2018.04.005",

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AU - Asongu, Simplice

AU - Batuo, Enowbi

AU - Nwachukwu, Jacinta

AU - Tchamyou, Vanessa

N1 - NOTICE: this is the author’s version of a work that was accepted for publication in Journal of Multinational Financial Management. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Journal of Multinational Financial Management (2018) DOI:10.1016/j.mulfin.2018.04.005

PY - 2018/6

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N2 - This study assesses how information diffusion dampens the adverse effect of market power on the price and quantity of loans provided by a panel of 162 banks from 39 African countries for the period 2001-2011. First, from the Generalised Method of Moments results, a mobile phone penetration rate of 54.29, rising to 57 per 100 people are predicted to neutralise the adverse effect of market power on the average loan price and quantity respectively. Second, from the Quantile Regressions, mobile phone penetration rates of 56.20, 52.04 and 42.76 per 100 people is needed to nullify the negative effect of market power on loan quantity at the 10th decile, 25th quartile and 90th decile respectively. Third, a considerably lower internet penetration rate of 9.49 per 100 people is required to counteract the negative impact of market power on loan quantity at the 90th decile. Policy implications are discussed.

AB - This study assesses how information diffusion dampens the adverse effect of market power on the price and quantity of loans provided by a panel of 162 banks from 39 African countries for the period 2001-2011. First, from the Generalised Method of Moments results, a mobile phone penetration rate of 54.29, rising to 57 per 100 people are predicted to neutralise the adverse effect of market power on the average loan price and quantity respectively. Second, from the Quantile Regressions, mobile phone penetration rates of 56.20, 52.04 and 42.76 per 100 people is needed to nullify the negative effect of market power on loan quantity at the 10th decile, 25th quartile and 90th decile respectively. Third, a considerably lower internet penetration rate of 9.49 per 100 people is required to counteract the negative impact of market power on loan quantity at the 90th decile. Policy implications are discussed.

KW - Financial access

KW - Market power

KW - Information asymmetry

KW - ICT

KW - Africa

U2 - 10.1016/j.mulfin.2018.04.005

DO - 10.1016/j.mulfin.2018.04.005

M3 - Article

VL - 45

SP - 88

EP - 104

JO - Journal of Multinational Financial Management

JF - Journal of Multinational Financial Management

ER -

Is information diffusion a threat to market power for financial access? Insights from the African banking industry

Abstract

Bibliographical note

Keywords

UN SDGs

Access to Document

Fingerprint

Cite this