Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/149963
Authors: 
Asongu, Simplice
Batuo, Enowbi
Nwachukwu, Jacinta
Tchamyou, Vanessa
Year of Publication: 
2016
Series/Report no.: 
AGDI Working Paper WP/16/039
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. The empirical evidence is based on three endogenity-robust estimation techniques, namely: (i) Two Stage Least Squares (2SLS), (ii) Generalised Method of Moments (GMM) and (iii) Instrumental Variable Quantile Regressions (QR). Three key results emerge. First, from the GMM 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 QR, 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 0.10th, 0.25th and 0.90th quintiles 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 0.90th quintile.
Subjects: 
Financial access
Market power
Information asymmetry
ICT
Africa
JEL: 
G20
G29
L96
O40
O55
Document Type: 
Working Paper

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