Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/229650 
Year of Publication: 
2021
Series/Report no.: 
GLO Discussion Paper No. 778
Publisher: 
Global Labor Organization (GLO), Essen
Abstract: 
This paper links banking system development to the colonial and legal history of African countries. Based on a sample of 40 African countries from 2000 to 2018, our empirical findings show a significant dependence of current financial institutions on the inherited legal origin and the colonization type. Findings also reveal that current financial legal institutions are not major determinants of banking system development, and that institutional development and governance quality are more important. A high share of government spending relative to GDP also positively affects banking system development in African countries.
Subjects: 
Legal origin
colonial history
financial institutions
banking system
correlated random effects model
JEL: 
G21
G38
G39
K15
K40
Document Type: 
Working Paper

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