Table 10 - uploaded by Simplice Asongu
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Background: The purpose of this study is to investigate how an increase in
information-sharing bureaus affects financial access.
Methods: We employed contemporary and non-contemporary interactive quantile
regressions in 53 African countries for the period 2004–2011. Information-sharing
bureaus are proxied with public credit registries and private...
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This paper examines the relationship between financial development and private sector investment in the post-financial sector liberalization episode in Tanzania. The proxies for financial development were the financial market depth index and financial institutions depth index. Applying Autoregressive Distributed Lag (ARDL) technique, the results sh...
Background
The purpose of this study is to investigate how an increase in information-sharing bureaus affects financial access.
Methods
We employed contemporary and non-contemporary interactive quantile regressions in 53 African countries for the period 2004–2011. Information-sharing bureaus are proxied with public credit registries and private...
Citations
... The Internet Growth and Contestable Market Theory (IGCMT) believes that growth in ICT (internet) usage results in economic growth and presents an opportunity to increase competition in the financial sector and ultimately expand financial access (see Goel & Hsieh, 2002). It further explains that the internet lowers investment costs and barriers to entry (Goel & Hsieh, 2002), reduces credit constraints such as information asymmetry (Andonova, 2006) and fuels several applications that support the availability of credit (see Asongu & Nwachukwu, 2017;Dandapani et al., 2018). ...
... This improves financial access, widens financial portfolio, stabilizes the financial sector and eliminates asymmetry information characterizing the operations of financial markets. Given the importance of ICT to the financial sector, several studies have been conducted to examine the role of ICT in financial development (Asongu & Nwachukwu, 2017;Cheng et al., 2021;Chien et al., 2020;Comin & Nanda, 2019;Del Gaudio et al., 2021;Ilyina & Samaniego, 2011;Karakara & Osabuohien, 2019;Lechman & Marszk, 2019;Marszk & Lechman, 2021;Mignamissi, 2021;Nguyen et al., 2020;Owusu-Agyei et al., 2020;Samargandi et al., 2019;Sassi & Goaied, 2013). Even though empirical findings appear to be inconclusive, these studies have focused on the causal-effect nexus between ICT and financial development. ...
... In furtherance of the positive effect of ICT on financial development, Del Gaudio et al. (2021) find that ICT exerts a positive effect on the financial sector performance and conclude that overall financial stability in the banking industry is enhanced by the intensive adoption of both IT and financial technologies, which increases the distance to default. Comin and Nanda (2019) support the findings that greater depth in financial markets leads to faster technology diffusion, whereas Asongu and Nwachukwu (2017) reveal the overall net effect of ICT on formal and informal financial activity is positive in African countries. Lechman and Marszk (2019) conclude that ICT has a positive relationship with financial development, financial institutions, bank deposits, total insurance and electronic payment. ...
... Credit information sharing (IS): Following prior studies (Asongu and Nwachukwu, 2017;Asongu et al., 2016;Triki and Gajigo, 2014;Hung Son et al., 2020), IS is proxied using the public credit registries (PCR) and private credit bureaus (PCB) as a percentage of adults covered. ...
Purpose
This study investigates the relationship between credit booms and bank risk in Association of Southeast Asian Nations (ASEAN) countries, with credit information sharing acting as a moderator.
Design/methodology/approach
The authors use a two-step System Generalized Method of Moments (SGMM) estimator on a sample of 79 listed banks in 5 developing ASEAN countries: Indonesia, Philippines, Malaysia, Thailand and Vietnam in the period 2006–2019. In addition, the authors perform robustness tests with different proxies for credit booms and bank risk. The data are collected on an annual basis.
Findings
Bank risk is positively related to credit booms and is negatively associated with credit information sharing. Further, credit information sharing reduces the detrimental effect of credit booms on bank stability. The authors find that both public credit registries and private credit bureaus are effective in enhancing bank stability in ASEAN countries. These results are robust to regression models with alternative proxies for credit booms and bank risk.
Research limitations/implications
Banks in ASEAN countries tend to have strong lending growth to support the economy, but this could be detrimental to stability of the sector. Credit information sharing schemes should be encouraged because these schemes might enable growth of credit without compromising bank stability. Therefore, policymakers could promote private credit bureaus (PCB) and public credit registries (PCR) to realize their benefits. The authors' research focuses on developing ASEAN countries, but future research could provide more evidence by expanding this study to other emerging economies. In-depth interviews and surveys with bankers and regulatory bodies about these concerns could provide additional insights in the future.
Originality/value
The study is the first to examine the role of PCB and PCR in alleviating the negative impact of credit booms on bank risk. Furthermore, the authors use both accounting-based and market-based risk measures to provide a fuller view of the impact. Finally, there is little evidence on the link between credit booms, credit information sharing and bank risk in ASEAN, so the authors aim to fill this gap.
... We use the following proxies to gauge different aspects of financial development, in line with the previous literature (Asongu & Nwachukwu, 2017;Asongu et al., 2016;Demirguc-Kunt & Maksimovic, 1996;King & Levine, 1993;Levine & Zervos, 1998): (1) FDGDP, the ratio of liquid liabilities to GDP, which is a measure of the size of the financial sector relative to the economy; (2) Two measures of financial intermediation activity are used: the ratio of domestic credit provided by the banking sector to GDP (BSD) and the ratio of domestic credit provided by the financial sector to GDP (FSD); (3) Nonperforming loans to total gross loans (NPL), which is a measure of financial sector efficiency. A lower level of non-performing loans reflects higher financial sector efficiency. ...
... Following previous studies (e.g. Asongu & Nwachukwu, 2017;Asongu et al., 2016;Barth et al., 2009;Triki & Gajigo, 2014), credit information sharing is measured with public credit registries and private credit bureaus as a percentage of adults covered. ...
... Five control variables are used in order to account for bias stemmed from variable omission, namely: GDP growth (GDP), financial freedom index (FINFREE), government expenditures, the rate of government expenditures over GDP (GOV), Trade openness, the ratio of the sum of total exports and imports to GDP (TRADE), rule of law (ROL). The choice of these variables is in accordance with the financial development literature (Asongu & Nwachukwu, 2017;Asongu et al., 2016;Cooray & Schneider, 2018;Herger et al., 2008). ...
This study investigates the individual impact of credit information sharing and corruption as well as their interaction on financial development, using a sample of 120 countries for the period 2004–2017. Public credit registries (PCR) and private credit bureaus (PCB) are used as proxies for the level of credit information sharing, whereas financial development is measured in terms of size, activity and efficiency. We obtain evidence in support of the following arguments. First, PCB has a negative impact on the size of the financial sector, whereas PCR has an insignificant effect. Second, PCB and PCR have a positive impact on the financial intermediation activity, with the magnitude of the latter being higher. Third, PCB and PCR increase the financial sector efficiency, again with the magnitude of the latter being stronger. Fourth, both PCR and PCB reduce the negative effects of corruption on financial sector development, but PCR tends to be more effective, suggesting that PCR may play a more important role compared to that of PCB. The findings survive a battery of robustness tests, including the use of an alternative corruption indicator and sub-sample analysis. Finally, policy implications are discussed.
... Asongu and Nwachukwu, 2017 ). Therefore, the study of compensa- ...
In a group decision-making (GDM) process, experts reach a consensus after discussion and persuasion, which requires a moderator to spend time and resource to persuade experts to change their original opinions. Since a unanimous agreement is hard to achieve and costly, a consensus degree or soft consensus was used and various approaches have been proposed to measure the level of consensus in GDM. Though cost is an important factor in GDM, few works have calculated consensus cost occurred during the process. Moreover, the degree of consensus was not considered in the minimum cost consensus study. The objective of this paper is to propose consensus models under a certain degree of consensus, which considers both consensus degree and cost in GDM. To do this, we develop a generalized soft cost consensus model under a certain degree of consensus, which is built by defining a consensus level function and a generalized aggregation operator. A soft minimum cost consensus model is constructed based on arithmetic weighted average operator (AWAO), and the maximum return model is constructed through its dual model. The cost (compensation) is studied from both the perspectives of a moderator and individual experts. The relationships between the two soft consensus cost models are analyzed, and the economic significance of the models are also discussed. Numerical examples are used to explain the proposed models. In addition, to show the usability of the proposed models in real-world context, we apply the proposed models to a loan consensus scenario using data from an online peer-to-peer lending platform.
... Given the development of the Internet finance, financial public opinion events emerge in large numbers, diversified, personalized and shared network information continues to increase [1][2], and network neologisms are always generated in social hot events, which are filled with a variety of newly emerged vocabularies that have not been included in the conventional dictionaries, that is, the unknown words. ...
The processing of unknown words is an important issue that impedes the performance of many natural language systems. In terms of the processing of financial public opinion, due to a wide variety of terminology in the financial sector and the suddenness of financial public opinion events as well as the proliferation of network vocabulary, a variety of unknown new words emerge while the traditional text classification method is basically incapable of processing these unrecognized characters. In this paper, an approach equipped with a new directional substitution model for processing the unknown words is proposed. Based on the semantic similarity of the context in word2ve algorithm, the model trains synonym substitution list and substitutes the unknown words in the original texts with synonyms. Also, the TFIDF (term frequency-inverse document frequency) -weighted Naive Bayes classifier is used to carry out the text classification experiments on the traditional datasets and the synthetic datasets including the unknown words. The experimental results show that the model has better classification effect than the traditional methods and can accurately identify the categories of the financial public opinion texts involving the unknown words by transforming the meaningless unknown words into the words containing meaning.
Given the indisputable roles of remittance and financial development in countries’ economic performance, enhancing the nexus between the two variables has become pertinent. The remittance–financial development literature has surged, with a growing argument that making the relationship work is conditioned on mediating roles of certain economic indicators. Despite the overwhelming evidence of the transformative roles of digital technology, the assessment of its possible mediating role in the remittance–financial development nexus is lacking in the literature. Hence, using pooled data of 35 Sub-Saharan African (SSA) countries sourced from the World Bank’s Development Indicators, this study examined the mediating effect of digital technology in the relationship between remittance inflows and financial development. Using two indicators of ICT—fixed broadband and mobile cellular subscription—the results of the generalized method of moment analysis suggest that digital technology spurs remittance inflows to promote financial development in SSA. The results are consistent for both measures. These findings imply that remittance and digital technology are complementary in promoting financial development in the sub-region. Based on these outcomes, the study therefore advances the enactment of policies aimed at fostering diffusion of digital technology and achieving the sustainable development goal’s recommendation of lower transaction cost of remittances.
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