Does age composition influence financial sector development in Sub-Saharan Africa region? The role of economic globalization

PurposeConsidering the panel data from 1984 to 2020, this study examines the impact of demographic structure (young age, working age and old age manpower) on financial development in 44 Sub-Saharan Africa (SSA) countries. Following the World Bank's classification, the SSA region is sub-sampled into 21 low-income, 18 lower-middle-income and five upper-middle-income countries to separately study these groups, along with studying for the whole region in a panel.Design/methodology/approachDrawing from the literature, it incorporates economic growth, economic globalization and inflation as a set of control variables in the financial sector development function. This study employed PCSEs and FGLS regression methods along with applying the FMOLS test for results robustness.FindingsThe result of PCSEs and FGLS evidences an adverse impact of the young and old age population on financial development for the entire SSA region, low-income and lower- and middle-income countries, but the same is found to be positively related to financial development in the upper- and middle-income countries. We observed varying effects of economic growth, economic globalization and inflation for different groups within the SSA region.Originality/valueFrom the policy perspective, it suggests that policymakers of the groups of low-income and lower-middle-income countries need to scrutinize the adverse effects of the young and old-age populations on financial sector development and should also be taken seriously in the formulation of their long-term financial development policies.