Browsing by Author "Bokpin, G."

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Corporate Governance, National Culture, and Corporate Debt Maturity Structure: Evidence from Sub-Saharan Africa
(University of Ghana, 2013-06) Laryea, E.A.; Bokpin, G.; Gemegah, A.
This study examines the impact of corporate governance and national culture on the debt maturity structure of firms in sub-Saharan Africa. A relatively unexplored area world- wide, the dearth of literature on debt maturity structure in Africa necessitates this study. This study sought to understand the impact that the corporate governance systems of sub- Saharan African firms have on corporate debt maturity on the basis of the argument that the debt maturity structure of a firm could augment the efforts of corporate governance systems in alleviating the agency problem of the firm. The study also found it worthwhile to explore the influence of national culture on the debt maturity decision based on the premise that the financial contractual environment within which the debt contract is agreed upon is made up of both formal and informal institutions like norms and values. The study employs a two-stage least square estimation technique and results suggest that the debt maturity structure of firms are explained by the corporate governance systems in place as well as the national culture of the people in the nation. The study therefore suggests that these two factors be carefully considered when the debt maturity structure decision is being made. The study finds that the financial systems in a country tell on the debt maturities of firms as well and recommends that in order to make more long-term debt available for development, policy makers must pay more attention to capital market development. The study also suggests that firm debt maturity decisions should be made bearing in mind the corporate governance system in place.
Do emerging financial markets matter in investment opportunity set? A dynamic panel analysis
(Journal of Money Investment and Banking, 2009) Abor, J.; Adjasi, C.K.D.; Bokpin, G.; Osei, K.A.
External Debts, Institutions and Growth in SSA
(Journal of African Business, 2018-03) Mensah, L.; Bokpin, G.; Boachie-Yiadom, E.
The study investigates the impact of institutional quality on the external debt–growth nexus in SSA. Data from 36 SSA economies over the 1996–2013 periods were used. The results from the IV-System GMM imply that institutional quality has robust effects on the external debt–growth nexus. Thus, the impact of external debt on growth is through host nation’s institutional quality. However, the mediating effect of institutional quality on this nexus is up to a point. When a country is on the wrong side of the debt-laffer curve, external debt becomes irrelevant; and institutional quality can no longer help.
Firm Productivity in the Presence of Binding Fiscal Constraints in Africa
(2016-04-22) Bokpin, G.
We examine two key questions in this paper. First, we investigate the implications of fiscal indiscipline or otherwise on firm productivity in Africa. Fiscal policy is known to boost growth by altering work and investment incentives, promoting human capital accumulation, and enhancing total factor productivity at the micro-level (IMF, 2015). Many factors have been studied in explaining total factor productivity in Africa or its sub-regions but the role of fiscal policy in explaining firm productivity remains understudied. Yet fiscal policy is considered a binding constraint in Africa. Fiscal indiscipline is known to crowd-out the private sector and seriously undermines private sector leadership in ensuring all inclusive, broad-based growth. We measure firm-level total factor productivity using a Cobb-Douglas production function, when we regress on firm characteristics and fiscal policy indicators. In estimations with controls for country and year fixed effects, we find results that suggests firms reporting finance as a severe obstacle have relatively lower productivity levels, productivity declined with age, and audited firms are more productive than those not audited. The level of government debt to GDP, we found, had significant implications for the relation between access to finance severity and firm productivity. Fiscal Indiscipline (in its various forms) severely constraints firm productivity. The implications are that fiscal mismanagement has implications for firm-level productivity.
Resource constraints and private sector investment in emerging economies: A review of the literature
(University of Ghana, 2015-04-17) Ababio, J.O-M.; Osei, K.A.; Bokpin, G.
This paper is a review and classification of literature on Private Sector Investment in Emerging Economies. Hundred and ten (110) articles published in a broad range of internationally recognized journals covering four major private sector investment (PSI) issues in Emerging Economies (EEs) were explored and analyzed. This paper also reviewed literature on the main segments of private sector investment: domestic investment, foreign direct investment, and international (private) portfolio investment in EEs. A review of the major streams of PSI research examining the determinants, constraints, uncertainties, management and performance as well as relevance and magnitude of PSI activities points out the current gaps and contributions for the growth and survival of private firms and the importance of PSI for economic growth and development in EEs. A unified perspective on these research, identifies and highlights imperative gaps for future research. Consequently, the review will serve as a roadmap indicating the current state, contributions and direction of research topics for the academics and practitioners.
Risk Exposure and Corporate Financial Policy on the Ghana Stock Exchange
(Emerald Group Publishing Limited, 2010) Bokpin, G.; Aboagye, A.Q.Q.; Osei, K.A.
Purpose – The purpose of this paper is to examine the extent to which corporate managers alter their capital structure in response to risk exposures on the Ghana Stock Exchange (GSE). Design/methodology/approach – A panel data covering the period from 2002 to 2007 was employed under the framework of the seemingly unrelated regression approach. Findings – The paper finds that the direction and magnitude of the impact of risk exposures depends on capital structure measurement variables; namely, financial leverage, debt ratio, or short‐term debt to equity. The paper also finds that corporate managers adjust their capital structure differently in response to different kinds of risk exposures namely business risk or financial risk. Specifically, operating risk, bankruptcy risk, and bankruptcy cost in addition to other firm level characteristics such as asset structure, firm size and profitability are found to be significant driving factors in shaping corporate financial policy on the GSE. Originality/value – The main value of this paper is to analyze the relationship between risk exposures and corporate financial policy from a developing country perspective.
Risk Premium and Foreign Direct Investment in Africa
(University of Ghana, 2015-06) Effah-Mensah, D.; Bokpin, G.; Isshaq, Z.; University of Ghana,College of Humanities, Business School,Department of Banking and Finance
Canonical finance theory holds that capital should move to the assets with the greater risk premium. Does foreign direct investment (FDI) move to countries with a higher country risk premia? We address this question in this study. We proxied country risk premium as the difference between the equity risk premium of an Africa country and the equity risk premium of US, sovereign bond spread and we measured foreign direct investment as the foreign inflows scaled by gross domestic product. Using a dynamic panel model and data from African countries from 2000-2012, we find that country risk premium has a positive and statistically significant effect on FDI irrespective of how the risk premium is measured. Variables commonly associated with FDI in the literature such as infrastructure availability and log of labor availability showed varying statistical significance, varying with the measurement of country risk premium. Alas, can we say international investors in the last decade are hunting for premia?