What question did this study set out to answer?

The research investigates how institutional quality influences the relationship between domestic savings and investment in African economies.

July 8, 2026EconomiesOpen Access

Do Institutions Matter for Turning Savings into Investment? Evidence from African Economies

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Authors

CACyril AyemeleUniversity of Johannesburg DMDikeledi MonyelaUniversity of Johannesburg FKFrederich KirstenUniversity of Johannesburg

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Implication

Examines how institutional quality affects the relationship between savings and investment in African economies, suggesting that strong governance enhances growth.

Key Points

The research investigates how institutional quality influences the relationship between domestic savings and investment in African economies.
Analyzed panel data from 45 African countries from 1996 to 2024.
Utilized a fixed-effects model including Driscoll–Kraay standard errors.
Assessed the moderating role of institutional quality on savings and investment dynamics.
Confirmed a positive relationship between domestic savings and fixed capital formation.
Established that higher institutional quality significantly enhances the effectiveness of savings in driving investment.
Found varying effects by income level, with stronger impacts in middle-income countries compared to low-income economies.

Cite This Study

Ayemele et al. (2026) studied this question.

synapsesocial.com/papers/6a4de9add2ea289ef6283ba2 https://doi.org/10.3390/economies14070257

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Implication

Examines how institutional quality affects the relationship between savings and investment in African economies, suggesting that strong governance enhances growth.

Do Institutions Matter for Turning Savings into Investment? Evidence from African Economies

Discussion

Member takes

Implication

Key Points

Cite This Study

Do Institutions Matter for Turning Savings into Investment? Evidence from African Economies

Discussion

Member takes

Implication

Key Points

Cite This Study

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