Financial sector and economic development in Sub-Saharan Africa, 1960–2015

This chapter analyses the behavior of the financial sector in Sub-Saharan Africa (SSA), and empirically evaluates the link between financial development and growth during 1960–2015. The main findings are twofold. First, while financial development was shallow until 2000, its pace picked up thereafter, albeit unevenly, across SSA countries and this trend was more reflective of saving mobilization than credit allocation. Second, results of the estimated growth model suggest that financial development affects growth only when a certain threshold of human capital (completion of secondary education) is achieved.