Technological advancement and regulatory quality

Abstract

This study investigates the intervening role of technological innovation and regulatory quality in the financial sector–sustainable economic growth nexus in accordance with SDG-8 in 38 sub-Saharan African (SSA) countries from 1996 to 2020. The empirical model endogenizes government expenditure, structural change, foreign direct investment, and human capital as covariates. The study verifies and examines the hypothesis by adopting common correlated mean group, system generalized method of moments, and panel quantile regression. Findings reveal that financial development drives sustainable economic growth in SSA for the long-run model with improved magnitudinal effects observed with the intervention of technological innovation and regulatory quality. Furthermore, both technological innovation and regulatory quality promote sustainable economic growth in SSA. Moreover, structural change, foreign direct investment and government are boosters for sustainable economic growth whereas military expenditure hinders the growth. Recommendations are made based on the findings.