TITLE:
Governance of Frontier Financial Markets in Sub-Saharan Africa: Macroeconomic Stability, IPO Activity and Market Performance
AUTHORS:
Henry Kwame Afriyie, Kwaku Ahenkora
KEYWORDS:
Governance of Frontier Markets, Macroeconomic Stability, IPO Activity, Financial Markets, Sub-Saharan Africa
JOURNAL NAME:
American Journal of Industrial and Business Management,
Vol.16 No.10,
October
16,
2026
ABSTRACT: Purpose: This study examines how IPO activity and macroeconomic conditions determine market performance in frontier Sub-Saharan African (SSA) markets, as well as the effects of institutional quality and regional characteristics. Design/Methodology/Approach: The study uses a multi-country panel dataset spanning 2000-2022 and an econometric framework with market-level controls and fixed effects to account for endogeneity and institutional and regional heterogeneity. Findings: IPO activity shows a positive association with one-year market performance in the baseline fixed effects model (a one-unit increase in IPO count is linked to a 1.88 percentage point higher one-year return, p = 0.026), but propensity score matching and an instrumental variable check do not confirm this relationship, and the instrument used is weak. GDP growth and inflation are not significant predictors of IPO activity or market performance once country and year fixed effects are included. The institutional quality split runs counter to expectation: the IPO to performance link is significant only in the lower institutional quality country group in this sample. Practical Implications: The findings underline the importance of strengthening institutional quality and maintaining macroeconomic stability when governing SSA frontier markets to improve capital market outcomes and encourage IPO activity and investor participation. Originality/Value: This study adds to the frontier-market literature through integrating IPO dynamics with macroeconomic and organisational factors in a multi-country African context. It shows that, in this small six-country sample, macroeconomic conditions do not significantly predict IPO activity or market performance once country and year fixed effects are included, and that the IPO–performance association is not robust to matching.