Economic Fluctuations and Growth in Sub-Saharan Africa: The Importance of Import Instability

The traditional thesis that export instability (XI) is deleterious to economic growth in developing economies has received mixed empirical results. For African countries, recent research suggests that the effect of XI is weak, but that capital (investment) instability (KI) adversely influences economic growth. The current study argues that in many of these nations, imports are likely to be critical to the growth process, while exports represent only one of the various sources of investment resources. Hence, import instability (MI) may pose a more serious problem than XI in hindering economic growth. Employing 1968-1986 World Bank data for 33 sub-Saharan African countries, XI, KI and MI variables are calculated for each country as the standard errors around the respective 'best-fitted' trends over the sample period. These instability measures and additional World Bank data are then used to estimate an augmented production function that controls for the effects of labour, capital, and exports. The study finds that although KI is still a relevant argument of the production function, MI appears to be even more important, while XI is extraneous.     

State, Business, and Economic Growth in India

For the past 25 years, India’s economy has grown at an average rate of nearly 6% annually. The widely embraced argument that this growth acceleration results from the Indian state’s adoption of a pro-market strategy is inadequate for two reasons: the higher growth rate began a full decade before the liberalizing 2reforms in 1991; and post-1991 industrial growth has not accelerated. Instead, India’s economy has grown briskly because the Indian state has prioritized growth since about 1980, and slowly embraced Indian capital as its main ruling ally. This pro-business growth strategy is likely to have adverse distributional and political consequences.     

Can Business Rights Alleviate Group-Based Inequality in Sub-Saharan Africa? Understanding the Limits to Reform

Abstract

Africa’s indigenous minorities face unique constraints, particularly in terms of engaging in even the most basic business activities. They typically lack business rights, but, even where such rights have been extended, they have had scant impact on group poverty. This paper argues that the failure of business rights to meaningfully transform the livelihoods of marginalised minority groups stems from elite capture of resources, dependency on external validation, and a contradiction between a collective problem (group poverty) and an individualist solution (business rights). African states could alter conditions through active pursuit of affirmative action policies, but lack socio-economic and political incentives.     

Political Instability and Export Performance in Sub-Saharan Africa

The political landscape of post-independent sub-Saharan Africa (SSA) has been one of rampant coups d'etat. Existing evidence suggests such elite political instability (PI) has been growth-inhibiting even when exports are accounted for. In the light of the increasing interest in the role of export-promotion strategies in fostering economic growth, however, the present paper examines the impact of PI on export performance in these economies. The paper explores the hypothesis that the lack of a stable political environment adversely influences export performance via competitiveness, and that PI may actually play a more crucial role in export than in overall GDP growth. Based on detailed data on the incidence of coups in 30 SSA countries, real export growth over 1967-1986 is regressed on a principal-component of the various forms of coup events - "successful" coups, abortive coups, and coup plots - as well as on export structure, terms of trade, production capacity, and exchange rate misalignment. The results support the above hypothesis of an adverse impact of PI on export growth, and further suggest that PI has been even more deleterious to exports than to overall GDP.     

Inequality and the Impact of Growth on Poverty: Comparative Evidence for Sub-Saharan Africa

This study explores the extent to which inequality affects the impact of income growth on the rates of poverty changes in sub-Saharan Africa (SSA) compared to non-SSA, based on an unbalanced panel of 86 countries over 1977–2004. For all three measures of poverty – headcount, gap, and squared gap – the impact of GDP growth on poverty reduction is a decreasing function of initial inequality. The impacts are similar in direction for SSA and non-SSA, so that within both regions there are considerable disparities in the responsiveness of poverty to income growth, depending on inequality. Nevertheless, the income–growth elasticity is substantially less for SSA, implying relatively small poverty-reduction response to growth.     

Tax Innovations and Public Revenues in Sub-Saharan Africa

Abstract

We study the effect of two tax innovations – value added taxes (VAT) and autonomous revenue authorities (ARA) – on tax revenues in sub-Saharan Africa. The dataset consists of 47 countries over 1980–2010. We find that VATs have no effect on total tax revenues, neither in the short- nor in the long-run. ARAs lead to higher tax revenues in the short- and medium-run, but the effect dissipates over time. The main conclusion is that tax innovations are not a panacea to overcome the revenue shortages in African countries, but they are helpful in the short- and medium-run.     

The Potential of Islamist Terrorism in Sub-Saharan Africa

This paper is about the potential of terrorism in African Islamic movements. In order to lessen ambiguities related to the plethora of definitions given to the Islamist phenomenon, the various definitions related to the phenomenon of Islamism are examined as introductory information indispensable to the understanding of the topic. While it describes the encounter of sub-Saharan Africa with Islam, it also covers a number of movements in different countries in the African continent: Nigeria, Tanzania, Senegal, Kenya, South Africa, Somalia, Ethiopia, Niger, Mali, Chad, and Sudan. In all of these countries, the emergence of Islamic movements, their socio-political status, their present position in relation to the ongoing debate on their perceived radicalization or their supposed threat of violence or terrorism are comparatively analyzed.     

Democracy, Colonization, and Human Capital in Sub-Saharan Africa

This article examines an empirical anomaly. In most developing regions, poor democratic nations enroll more primary school students than their authoritarian counterparts. Regime type, however, cannot account for the wide variance in enrollment in Africa. This study demonstrates that colonial heritage is a good predictor of primary school enrollment for low-income countries in Africa. Additional analysis shows that colonization's impact on education has not diminished since independence. Rather, the initial differences in enrollment between the former French and British colonies have grown over time. The results hold important implications for the study of political institutions and their impact on economic development. Even after they no longer exist, political institutions can have substantial lingering effects on important developmental outcomes. David S. Brown is an assistant professor of political science at Rice University. His work has appeared recently inThe American Political Science Review, Political Research Quarterly, and inComparative Political Studies. His work focuses on the political economy of development and is based on cross-regional work with specialization in Latin America. Specific areas of interest are human capital, democracy, and the international determinants of domestic politics.     

Institutional and management building in Sub-Saharan Africa: a symposium

In the latter half of the 20th century many factors have contributed to the decline of Africa and especially of Sub-Saharan Africa (SSA). Severe drought and the resultant famine, the international environment of deteriorating export markets, economic and bureaucratic mismanagement, environmental damage and rural decline, political instability and civil wars are some factors often highlighted as representative causes of the decline.     

Overurbanization and underdevelopment in Sub-Saharan Africa: A cross-national study

"This paper discusses both the urban bias and world-system theories of overurbanization and presents a cross-national analysis of 32 African nations to test these perspectives. The analysis is divided into three parts. First, the effects of urban bias (i.e., the disparity in welfare between rural and urban areas) and economic dependence on overurbanization are examined. Next, the association between overurbanization and (1) the structure of the labor force and (2) economic growth is tested. Finally, the relationship between the structure of the labor force and economic growth is evaluated." The results indicate that "the rural-urban disparity and foreign investment facilitate overurbanization, and that an increase in level of overurbanization has a deleterious impact on both the structure of the labor force and economic growth. Furthermore, there is strong evidence indicating that an increase in service-sector employment has a negative effect on economic growth."     

Failed States and the Spread of Terrorism in Sub-Saharan Africa

Plagued by systematic state failure, sub-Saharan Africa's failed states have helped facilitate internationally sponsored terrorist networks and operations. However, until recently, this type of activity was primarily relegated to North Africa and the Horn. But that has begun to change. Now, what was once a seemingly benign terrorist presence in sub-Saharan Africa is starting to transform into a movement, with states such as Nigeria, Sierra Leone, Liberia, and the Democratic Republic of the Congo (DRC) now lending arms, financial support, and radical militants to the extremist jihadist movement of internationally sponsored terrorist organizations such as Al Qaeda. Further, with the recent bombings in Kenya and Somalia, and the failed bombing attempt on a U.S. airliner by a Nigerian national, it is becoming increasingly evident that internationally sponsored terrorist networks have found a permanent home in sub-Saharan Africa and within the hearts and minds of its people, which poses significant challenges for the international community, given the region's patchwork of failed states, where terrorists can easily hide and thrive. Consequently, this study discusses how the conditions of state failure have fostered support for internationally sponsored terrorism in sub-Saharan Africa. Terrorist groups are now actively recruiting more militants from within the region and popular support for extremist acts is on the rise in sub-Saharan Africa. Thus, the article argues sub-Saharan Africa will soon become the site for the next generation of terrorists, and the next wave of terrorist activity.     

Managerial attitudes of public sector managers in Sub-Saharan Africa

Africa, and more specifically Sub-Saharan Africa, is faced with severe economic problems. The public sector, both the political and the managerial, is under severe attack to change its approach to the organization and management of society and its administrative System.

There is today, external, and to some extent internal, pressure to downsize the administrative system, to privatize, and to generally give up the prominent role played by the administrative system in the production and distribution of the general welfare.

This study attempts to assess the attitudes of public sector managers in Sub-Saharan Africa to what may be called universal managerial concerns such as problem-solving, leadership, job challenge, change, and organizational culture. It also assesses the level of satisfaction with career and particular positions of Sub- Saharan African mangers. In assessing attitudes and levels of satisfaction, we compare managers' attitudes with managers from other third world countries. The study concludes with the findings that routineness of work generates negative attitudes while bureaucratization and experience initiate positive attitudes towards universal managerial concerns.     

Rural Livelihood Diversification in Sub-Saharan Africa: A Literature Review

This article provides a comprehensive review of the literature on the nature and evolution of rural livelihood diversification in sub-Saharan Africa, and the situation regarding smallholders. It reveals mixed findings about the causes and consequences of livelihood diversification on rural smallholders adopting this strategy. A lot of evidence from the literature suggests that it is relatively better-off smallholders with sufficient assets who achieve successful livelihood diversification, mainly by exploiting opportunities and synergies between farm and nonfarm activities. Because of asset constraints, increase in incomes and wealth based on livelihood diversification has not yet benefitted the large majority of smallholders.     

Determinants of Intraregional Migration in Sub-Saharan Africa 1980-2000

Abstract

Despite great accomplishments in the migration literature, the determinants of South-South migration remain poorly understood. In an attempt to fill this gap, this paper formulates and tests an empirical model for intraregional migration in sub-Saharan Africa within an extended human capital framework, taking into account spatial interaction. Using bilateral panel data between 1980 and 2000, we find that intraregional migration on the subcontinent is predominantly driven by economic opportunities and sociopolitics in the host country, facilitated by geographical proximity. The role played by network effects and environmental conditions is also apparent. Finally, origin and destination spatial dependence should definitely not be ignored.     

Understanding Education's Influence on Support for Democracy in Sub-Saharan Africa

Is education consequential for popular endorsement of democracy in developing societies and, if so, what are the mechanisms that account for this influence? We investigate the micro-foundations of the education–democracy nexus using a survey of 18 sub-Saharan African countries. We demonstrate that educational level is the strongest influence on support for democracy and rejection of non-democratic alternatives via its impact on comprehension of, and attention to, politics. This is consistent with a cognitive interpretation of the effects of education on democratic values rather than one which treats education as a marker of economic resource inequalities.     

Linkages between Globalisation,Carbon Dioxide Emissions and Governance in Sub-Saharan Africa

ABSTRACT

This study investigates linkages between environmental degradation, globalisation and governance in 44 countries in Sub-Saharan Africa using data for the period 2000–2012. The Generalised Method of Moments is employed as empirical strategy. Environmental degradation is proxied by carbon dioxide emissions whereas globalisation is appreciated in terms of trade openness and net foreign direct investment inflows. Bundled and unbundled governance indicators are used, namely: political governance (consisting of political stability/no violence and “voice & accountability”), economic governance (encompassing government effectiveness and regulation quality), institutional governance (entailing corruption-control and the rule of law) and general governance (a composite measurement of political governance, economic governance and institutional governance). The following main finding is established. Trade openness modulates carbon dioxide emissions to have positive net effects on political stability, economic governance, the rule of law and general governance.     

Enhancing sustainable development in Sub-Saharan Africa: concepts,recommendations and illustrations

In recent years, the concept of sustainable development has received renewed attention. As global resources shrink and needs continue to grow, the staying power of development impact is becoming central concern of both governments and donors. Recent studies have shown that only a small percentage of projects throughout the world have achieved sustainability, and the need for improving the long-term vitality of development investments is growing. No area in the world has shown more need of this than Africa. This paper outlines a conceptual approach for analyzing sustainability and synthesizes the lessons learned from the application of this model in recent field work. The model is based on the theory that two preconditions must exist before sustainability can occur: 1 ) commitment to long term sustainable development; and 2) beneficiary and stakeholder involvement via incentives which support achieving sustainability . Fieldwork-based recommendations to enhance sustainability include: 1) understand the long-term incentive structure that drives the project; 2) identify performance targets and communicate results early-on; 3) identify long-term recurrent costs and funding options; 4) build in flexibility to the project plan; 5) build-in ways for participants to support and “take ownership” of the project; 6) use local resources, both human and physical, and keep technologies simple; and 7) use marketing strategies to reinforce perceived, satisfactory benefits of the project. Case examples of successful African projects from West Africa, Burkina Faso and Kenya illustrate the application of the sustainability concepts. In the context of these illustrations, the sustainability framework appears useful for understanding and analyzing sustainability and provides a necessary addition to thinking about development projects and programs.     

Environmental dimensions of managing public budgets and public enterprises in Sub-Saharan Africa

This study examines the nature of the environment in which public budgets and public enterprises are managed in developing countries in Sub-Saharan Africa. It develops a model of the environmental dimensions in the general environment and dimensional components in the task environment of public budgeting and public enterprise management including the economic, political, socio-cultural, and technological dimension which determine public budget and public enterprise management in developing countries like those in Sub-Saharan Africa. The implications of those environmental dimensions and their components are evaluated for budgetary processes and budgetary outcomes in selected countries in Sub-Saharan Africa - Kenya, Nigeria, Tanzania, and Ethiopia. The impact of economic dimensions in inducing repetitive budgeting in the budgetary processes of developing countries was highlighted. The results of the analysis of expenditure patterns in these countries tend to support the greater strength of the economic functional dimension in influencing budgetary outcomes. The implications of the environmental dimensions of the model for the management of public enterprises was also investigated. Numerous dimensional components of the major dimensions of the model developed in the study were found to have had an impact on the development of the public enterprise sector in developing countries like those in Sub- Saharan Africa. Moreover, the performance of public enterprises was strongly linked to the dimensions and components of the model. The interactive effects of public enterprise management on public budgeting in developing countries is also addressed as a consequence of the environmental model. Reform efforts must contend with altering the environmental state depicted in the model or accommodating to it.