Political Regimes and Stock Market Performance in Africa

S. Asongu, Jacinta Nwachukwu

Research output: Contribution to journalArticlepeer-review

6 Citations (Scopus)


This article assesses the effect of political institutions on stock market performance in 14 African countries for which stock market data are available for the period 1990–2010. The estimation technique used is a two-stage least-squares instrumental variable methodology. Political regime channels of democracy, polity and autocracy are instrumented with legal-origins, religious-legacies, income-levels and press-freedom qualities to account for stock market performance dynamics of capitalisation, value traded, turnover and number of listed companies. The findings show that countries with democratic regimes enjoy higher levels of financial market development compared to their counterparts with autocratic inclinations. As a policy implication, the role of sound political institutions has important effects on both the degree of competition for public office and the quality of public offices that favour stock market development on the African continent.
Original languageEnglish
Pages (from-to)240-249
Number of pages10
JournalPolitical Studies Review
Issue number3
Early online date27 Dec 2016
Publication statusPublished - Aug 2018


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