The Dark Side of Democracy
New Empirical Evidence of Its Effect on Banking Stability
Bibliographic Data
| ID | 6445459 |
|---|---|
| Authors | Christian‐lambert Nguena (0000-0001-8889-9601, Université de Dschang), Tii N Nchofoung (0000-0003-2436-6659), Darius Djani (Université de Dschang) |
| Year | 2025 |
| Volume | 53 |
| Issue | 3 |
| Publication date | 2025-05-07 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Politics & Policy (JOURNAL) |
| Journal identifiers | ISSN: 1555-5623 • E-ISSN: 1747-1346 |
| Publisher | Wiley (PUBLISHER • GB) |
| DOI | 10.1111/polp.70034 |
| OpenAlex | W4410166455 |
| Language | EN |
| References cited | 51 |
Due to less settled securities exchanges, the main source of risk of the financial system in Africa is characterized by its most significant aspects being the banking sector in particular. Consequently, the overall stability of the financial system can be ensured by the stability of the banking sector. Furthermore, the greatest number of nations in Africa has historically been viewed as weak democracies. Thus, the purpose of this article is to examine the impact of democracy on banking stability in Africa. The approach includes data for 34 African countries from 2004 to 2019, and OLS and IV‐Tobit estimation techniques. Our diagnosis shows that democracy harms banking stability in Africa, with the results robust across different types of democracy, levels of political stability, proximity to the sea, and alternative indicators of banking stability. This affirms that democracy is not good for every sector's stability, especially for the banking sector. Policy implications are discussed. Related Articles Aideyan, Osaore. 2016. “Political and Institutional Prerequisites for Monetary Union: Assessing Progress in the Economic Community of West African States (ECOWAS).” Politics & Policy 44(6): 1192–212. https://doi.org/10.1111/polp.12183 . Asongu, Simplice A., Joseph Nnanna, and Vanessa S. Tchamyou. 2021. “Finance, Institutions, and Private Investment in Africa.” Politics & Policy 49(2): 309–51. https://doi.org/10.1111/polp.12395 . Scarlato, Margherita, and Giorgio d'Agostino. 2019. “The Political Dimension of Cash Transfers in Latin America and Sub‐Saharan Africa: A Comparative Perspective.” Politics & Policy 47(6): 1125–55. https://doi.org/10.1111/polp.12332
Astronomy · Democracy · Econometrics · Economics · Great Rift · Monetary economics · Physics · Political science · Stability (learning theory · Computer Science · Corruption and Economic Development · Culture, Economy, and Development Studies · Economic Growth and Development · Law
Political Order in Changing Societies
The great reversals
Enhancing ICT for inclusive human development in Sub-Saharan Africa
Democracy and growth
Democratic Capital
Democracy and Knowledge
Democracy and Development
Does ICT promote democracy similarily in developed and developing countries? A linear and nonlinear panel threshold framework
Does Oil Still Hinder Democracy
Democracy, Dictatorship and Protection of Property Rights
Authoritarianism Goes Global
Democracy, Market Liberalization, and Political Preferences
The Effects of Democracy on Economic Growth and Inequality
Gender, political inclusion, and democracy in Africa
Why Do Some Oil-Producing Countries Succeed in Democracy While Others Fail
Do Natural Resource Revenues Hinder Financial Development? The Role of Political Institutions
Political systems and distortions
Do banking crises improve democracy
Democracy Does Cause Growth
Capital and Employment
Great expectations
The Democratic Disconnect
Democracy and Financial Crisis
Democracy and Macroeconomic Performance in Underdeveloped Countries
The quality of government
Banking crises and politics
| Citation velocity | historical |
|---|---|
| Highly cited | No |