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This study aims to investigate the impact of energy access on foreign direct investment (FDI) in an emerging market.

The study uses the two-stage least square instrumental variables estimation approach to compute the parameters of the model to account for any potential endogeneity and time persistence in energy access.

The results show that energy access significantly influences FDI inflows in Ghana. The results of the study also revealed that natural resources and macroeconomic variables such as real interest rate, gross domestic product growth rate are significant determinants of FDI inflows in Ghana.

The practical implication of this study is that there is a need for energy sector policy reforms in Ghana that would guarantee a secured and continued supply of energy to enhance energy access to boost FDI. Ghana should aim for a cost-effective, stable and environmentally friendly source of energy as an alternative to hydro energy as the main source of its power generation to promote FDI. Also, Ghana should initiate and implement policies aimed at creating an enabling and stable macroeconomic environment, as macroeconomic factors in this study are found to be drivers of FDI.

This study provides firsthand information on energy access and FDI from the Ghanaian perspective.

The purpose of this paper is to primarily investigate the ability of independent central banks (central bank independence (CBI)) to improve fiscal performances in Africa, accounting for election years, and also to examine whether the effectiveness of CBI in improving fiscal performance is enhanced by higher political institutional quality.

Using recent CBI data from Garriga (2016) on 48 African countries, 90 other developing countries and 40 developed countries over the period 1970–2012, the authors apply a two stage system GMM with Windmeijer (2005) small sample robust correction estimator to examine the impact of CBI and elections on fiscal policy in Africa, other developing countries and developed countries.

The authors provide evidence that unlike in other developing countries and developed countries, CBI does not significantly improve fiscal performance in Africa. However, the effectiveness of CBI in improving fiscal performance in Africa is enhanced by higher levels of institutional quality. Although elections directly worsen fiscal performance in Africa, institutional quality enhances CBI’s effect on improving fiscal performance in election years across Africa, other developing countries and developed countries.

The findings of the study are significant as they provide insight into the benefits of having strong institutions to complement independent central banks in order to control fiscal indiscipline in election years.

The study is the first among the studies of CBI-fiscal policy nexus, to measure fiscal policy using net central bank claims on government as a percentage of GDP. In addition to the use of fiscal balance, this study also uses cyclically adjusted fiscal balance as a measure of fiscal policy. This is a critical channel through which independent central banks can constrain government spending. It also compares findings in Africa to other developing countries, noting some differences.