Financial Innovations, Deepening-HHC Expend dataset
Description
This is annual secondary data for the period 2012-2019 covering 34 African countries. The data is used to examine the impact of financial innovations on financial deepening with implications for household consumption expenditure. Five financial innovation indicators are adopted and include the number of ATMs & bank branches for every 100,000 people, mobile cellular subscriptions for every 100 inhabitants, secure internet servers for every 1 million adults, and the Africa Infrastructure Development Index (AIDI). The latter was developed by the African Development Bank (AfDB) and measures the extent of infrastructural development in African countries. It is a composite measure of electricity, transport, ICT, and water supply & sanitation indexes (see African Development Bank, 2022). The rest of the innovation indicators are obtained from the World Bank’s World Development Indicators (WDI) database. To measure financial deepening, 3 indicators are used. They include bank deposits, domestic credit to the private sector, and broad money (all as ratios of GDP). A number of control variables are also captured here namely trade openness, GDP per capita, Foreign Direct Investment (FDI), remittances, and institutional quality. The institutional quality index is generated by the Principal Component Analysis (PCA) technique. To construct the index, we employ 6 indexes from the Worldwide Governance Indicators (WGI) database namely corruption control, rule of law, political stability, government effectiveness, regulatory quality, and voice & accountability. To measure consumption, we use data on final household consumption expenditure from the WDI database