Are Resource-Rich Countries More Attractive than Countries with Good Institutions to Foreign Direct Investors in Sub-Saharan Africa?

Africa is no longer behind in the race of acquiring global share of foreign direct investment (FDI) compared to other developing regions. This study uses FDI dataset of 27 sub-Saharan African (SSA) countries and examines what drives the recent trend of higher FDI flows to Africa. A variety of empirical techniques (e.g. cross-section OLS, panel fixed effects and dynamic GMM) are employed for identifying main drivers of FDI in African countries. The finding of this research suggests that resource endowment is the main driver attracting FDI to SSA countries. More specifically, empirical estimates suggest that a one-standard deviation increase in resource endowment in the SSA countries is associated with an increase in FDI ranging from 34% to 83%. Empirical result also suggests that between institutions and resource endowment, resource endowment is the most robust determinant of FDI in SSA countries.

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Foreign Direct Investment - Growth Linkage in Sub-Saharan Africa: Is Governance a Mediating Factor?

International Journal of Business Economics and Management ◽

10.18488/journal.62.2019.62.111.129 ◽

2019 ◽

Vol 6 (2) ◽

pp. 111-129

Author(s):

Fisayo Fagbemi ◽

Kehinde Mary Bello

Keyword(s):

Economic Growth ◽

Fixed Effects ◽

Political Stability ◽

Business Environment ◽

Mediating Effect ◽

Sub Saharan Africa ◽

Policy Framework ◽

Investment Efficiency ◽

African Countries ◽

Sub Saharan

In sub – Saharan Africa, weak institutions and the rising concern for improved business environment offer considerable leverage for enhancing the effectiveness of institutional framework, capital inflows, and public investment efficiency. These have put SSA in the global spotlight in recent times. Hence, the study examines the mediating effect of governance on FDI – growth nexus in 35 SSA countries between 2002 and 2017 using panel data techniques (Pooled OLS, Fixed Effects, and Panel-Corrected Standard Error’ (PCSE) estimation) and the Dynamic One – Step Difference and System GMM. Results indicate that control of corruption, political stability and regulatory quality, including governance composite index, have a positive and significant effect on economic growth, suggesting that institutions have a salutary impact on SSA economies. The findings further show that FDI inflows adversely influence growth owing to insufficient absorptive capacity that could enhance FDI effectiveness in the region. More importantly, the pervasiveness of poor governance in SSA is identified as a critical case that undermines the development of the nexus between FDI and economic growth. Thus, the study suggests that FDI – growth linkage would be enhanced by promoting a strong institutional environment that offers a good mechanism for attaining the actual FDI spillover potential through a policy framework that points the path towards cost-effective measures in SSA. Also, there should be core investment policies across African countries that would induce the private sector in consolidating government efforts and resources aimed at improving international competitiveness by diversifying the region’s economies away from a protracted commodity – based.

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Democracy, consumption, and growth in sub-Saharan Africa

International Area Studies Review ◽

10.1177/2233865919871702 ◽

2019 ◽

Vol 23 (1) ◽

pp. 28-48

Author(s):

John A Doces

Keyword(s):

Public Goods ◽

Fixed Effects ◽

Authoritarian Regimes ◽

Sub Saharan Africa ◽

Political Regime ◽

Government Consumption ◽

Private Goods ◽

Empirical Estimates ◽

Democratic Regimes ◽

Sub Saharan

This article studies the effect of political regime type on economic growth in sub-Saharan Africa. Democracy promotes growth because it conditions government consumption so that consumption is used for public purposes rather than private needs and this in turn leads to faster growth. By conditioning consumption towards public goods and away from private goods, we should see that consumption in democratic regimes is associated with more public goods like roads and education while in authoritarian regimes consumption yields less of these goods. Likewise, consumption should be associated with falling fertility in democratic regimes and rising fertility in authoritarian regimes. Using several measures of growth, the empirical estimates from a large- n fixed-effects regression show that democracy conditions consumption so that the latter is associated with faster growth. Moreover, the empirical analysis indicates that government consumption in democratic regimes is associated with more education completion and lower fertility rates.

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Effect of economic growth on employment in Sub-Saharan Africa.

INTERNATIONAL JOURNAL OF MANAGEMENT & INFORMATION TECHNOLOGY ◽

10.24297/ijmit.v16i.8940 ◽

2021 ◽

Vol 16 ◽

pp. 28-41

Author(s):

Francis Kamau Ndung’u ◽

Professor Niu Xiongying

Keyword(s):

Economic Growth ◽

Fixed Effects ◽

Secondary Data ◽

Sub Saharan Africa ◽

Economic Sectors ◽

African Countries ◽

Total Employment ◽

Development Indicators ◽

Domestic Capital ◽

Sub Saharan

The study aimed at investigating the effect of economic growth on employment in Sub-Saharan African. The study employed secondary data that was sourced from the World Bank, World development indicators and FAOSTAT covering 30 Sub Saharan African Countries for the period 1990 to 2015. The study employed the traditional neo-classical aggregate production function in its estimation of the regression results. The panel data obtained was analysed using the STATA software program. Hausman test was used and it determined that fixed effects estimation was preferred to random effects estimation and therefore fixed effects regression was used during the analysis. Empirical results on effect of economic growth on employment established that total employment, women in employment and men in employment statistically and significantly influenced economic growth and on the other hand economic sectors which comprised of domestic capital, imports, exports and services sectors statistically and significantly influenced economic growth.

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Clusters of sub-Saharan African countries based on sociobehavioural characteristics and associated HIV incidence

10.1101/620450 ◽

2019 ◽

Cited By ~ 2

Author(s):

Aziza Merzouki ◽

Janne Estill ◽

Erol Orel ◽

Kali Tal ◽

Olivia Keiser

Keyword(s):

National Level ◽

Principal Component ◽

Sub Saharan Africa ◽

Demographic And Health Surveys ◽

People Living With Hiv ◽

Hiv Incidence ◽

African Countries ◽

Aggregated Data ◽

Sub Saharan ◽

Ssa Countries

AbstractIntroductionHIV incidence varies widely between sub-Saharan African (SSA) countries. This variation coincides with a substantial sociobehavioural heterogeneity, which complicates the design of effective interventions. In this study, we investigated how sociobehavioural heterogeneity in sub-Saharan Africa could account for the variance of HIV incidence between countries.MethodsWe analysed aggregated data, at the national-level, from the most recent Demographic and Health Surveys of 29 SSA countries [2010-2017], which included 594’644 persons (183’310 men and 411’334 women). We preselected 48 demographic, socio-economic, behavioural and HIV-related attributes to describe each country. We used Principal Component Analysis to visualize sociobehavioural similarity between countries, and to identify the variables that accounted for most sociobehavioural variance in SSA. We used hierarchical clustering to identify groups of countries with similar sociobehavioural profiles, and we compared the distribution of HIV incidence (estimates from UNAIDS) and sociobehavioural variables within each cluster.ResultsThe most important characteristics, which explained 69% of sociobehavioural variance across SSA among the variables we assessed were: religion; male circumcision; number of sexual partners; literacy; uptake of HIV testing; women’s empowerment; accepting attitude toward people living with HIV/AIDS; rurality; ART coverage; and, knowledge about AIDS. Our model revealed three groups of countries, each with characteristic sociobehavioural profiles. HIV incidence was mostly similar within each cluster and different between clusters (median(IQR); 0.5/1000(0.6/1000), 1.8/1000(1.3/1000) and 5.0/1000(4.2/1000)).

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Developing a User-Based Decision-Aid Framework for Water Storage Systems in Sub-Saharan Africa: The Case of Blue Nile Basin in Ethiopia

Water Economics and Policy ◽

10.1142/s2382624x15500125 ◽

2015 ◽

Vol 01 (04) ◽

pp. 1550012

Author(s):

Stefanos Xenarios ◽

Heracles Polatidis ◽

Matthew McCartney ◽

Attila Nemes

Keyword(s):

National Level ◽

Water Storage ◽

Feasibility Studies ◽

Data Availability ◽

Sub Saharan Africa ◽

Crop Modeling ◽

African Countries ◽

Promethee Ii ◽

Sub Saharan ◽

Ssa Countries

The development of water storage schemes in Sub-Saharan Africa (SSA) is considered a major aid for those regions with unequal water distribution, limited accessibility and anticipated climate change impacts. Great attention is given by many SSA countries to set up different water storage schemes that may improve rural and urban development on a national level. The funding for the water storage schemes is often derived from foreign agencies which conduct feasibility studies for the financing of potential investments. Often however, the feasibility studies rely on a single monetary criterion which may not identify the most appropriate water storage in each case. In addition, limited data availability in many SSA countries increases the difficulty of identifying the most suitable storage option. This paper develops a multicriteria framework for the integrated evaluation of water storage strategies in Sub-Saharan African countries. A set of economic, agronomic and opinion-based criteria are assessed through the PROMETHEE II outranking approach. The introduction of crop modeling complements the limited field data available in agronomic criteria and enhances the scientific rigor of the method. Ethiopia is adopted as a representative case of SSA countries where a diverse set of water storage options is currently under construction, often financed by foreign agencies.

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Effect of economic sectors on employment in Sub-Saharan Africa.

INTERNATIONAL JOURNAL OF MANAGEMENT & INFORMATION TECHNOLOGY ◽

10.24297/ijmit.v16i.8941 ◽

2021 ◽

Vol 16 ◽

pp. 42-58

Author(s):

KAMAU NDUNGU

Keyword(s):

Gender Gap ◽

Fixed Effects ◽

Random Effect ◽

Sub Saharan Africa ◽

African Region ◽

Economic Sectors ◽

African Countries ◽

Hausman Test ◽

Aggregate Production Function ◽

Sub Saharan

The motif of this study was to determine the effect of economic sectors on employment in Sub-Saharan Africa, given that the Sub-Saharan African region had had about two decades of sustained economic growth. Thirty Sub-Saharan African countries were used in this study, their data that was obtained and used spanning from the year 1990 to the year 2015. The study made use of the traditional neo-classical aggregate production function in the estimation of the regression results. The software program that was used in data analysis was STATA. Hausman test was undertaken and it determined that fixed effects estimations were preferred to random effect and as a result fixed effects were utilized in the study in carrying out regression analysis. On effect of economic sectors on employment, foreign direct investment was found to negatively influence employment though the influence was not statistically significant. The export and agriculture variables negatively and statistically significantly influenced employment. All the other variables in the study were found to positively and statistically significantly influence employment. Empirical results established that the gender gap in employment was maintained in the whole period of the study with more men being employed than women.

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Remittances and health outcomes in Sub-Saharan African countries: Understanding the role of financial development and institutional quality

Economic Annals ◽

10.2298/eka2129119b ◽

2021 ◽

Vol 66 (229) ◽

pp. 119-144

Author(s):

Uweis Bare ◽

Yasmin Bani ◽

Normaz Ismail ◽

Anitha Rosland

Keyword(s):

Health Outcomes ◽

Financial Development ◽

Institutional Quality ◽

Sub Saharan Africa ◽

African Countries ◽

Dynamic Panel ◽

Sub Saharan ◽

Ssa Countries

Sub-Saharan Africa (SSA) is one of the highest recipients of remittances; however, this is inconsistent with the region?s growth and the state of its weak healthcare systems. This paper therefore analyses the effect of remittances on health outcomes for 39 selected SSA countries over the period 1996 to 2016. It considers the channels through which remittances affect health outcomes, including financial development and institutional quality. Using dynamic panel estimation, we find that remittances sustain health outcomes, while both financial development and institutional quality complement remittances in this respect. SSA countries should therefore continue to improve their financial sectors and develop the quality of institutions to an adequate level. Achieving sound financial systems and institutions would both allow and attract a substantial amount of remittances, benefitting human capital and health outcomes and alleviating poverty.

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Economic Fluctuations in Sub-Saharan Africa

10.1093/oso/9780198785811.003.0004 ◽

2018 ◽

Author(s):

Giovanni Melina ◽

Rafael Portillo

Keyword(s):

Sub Saharan Africa ◽

African Countries ◽

Macroeconomic Volatility ◽

Advanced Economies ◽

Main Shocks ◽

The World ◽

Tentative Interpretation ◽

Sub Saharan ◽

Macro Variables ◽

Ssa Countries

The chapter compares business cycle fluctuations in sub-Saharan African countries to the rest of the world. Its main results are: (i) African economies stand out by their macroeconomic volatility, which is reflected in the volatility of output and other macro variables; (ii) inflation and output tend to be negatively correlated in SSA countries; (iii) unlike advanced economies and emerging markets (EMs), trade balances and current accounts are acyclical in SSA; (iv) the volatility of consumption and investment relative to GDP is larger than in other countries; (v) the cyclicality of consumption and investment is smaller than in advanced economies and EMs; (vi) there is little comovement between consumption and investment; and (vii) consumption and investment are strongly positively correlated with imports. The chapter provides a tentative interpretation in terms of the main shocks hitting these economies and the nature of the mechanisms amplifying or dampening these shocks.

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Husbands' Dominance in Decision-Making About Women's Health: A Spatial Diffusion Perspective in Sub-Saharan Africa

Demography ◽

10.1215/00703370-9429489 ◽

2021 ◽

Author(s):

Liliana Andriano ◽

Julia Behrman ◽

Christiaan Monden

Keyword(s):

Decision Making ◽

Fixed Effects ◽

Spatial Regression ◽

Sub Saharan Africa ◽

Spatial And Temporal Variation ◽

Demographic And Health Surveys ◽

Country Level ◽

Sub Saharan ◽

And Gender ◽

Panel Fixed Effects

Abstract This article maps spatial and temporal variation in husbands' dominance in decision-making about their wives' health using pooled Demographic and Health Surveys from 28 countries in sub-Saharan Africa in an earlier (i.e., 2001–2005) and later (i.e., 2010–2014) period. First, we use adaptive bandwidth kernel density estimation to show how aggregate country-level estimates of husbands' decision-making dominance mask enormous spatial heterogeneity within countries. Our maps also reveal a geographic clustering of cells with similar levels of husband's decision-making dominance both within and between countries. Next, we use panel fixed-effects spatial regression methods to show that decreases in husbands' decision-making dominance in neighboring cells are associated with decreases in husbands' decision-making dominance in the reference cell. These findings support a diffusion explanation for declines in husbands' decision-making dominance over time. Our analyses also indicate that schooling and urbanization may be important channels through which diffusion occurs, which we speculate is because these are places where people are exposed to new ideas and gender norms.

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Infrastructure and Manufacturing Value Added in Sub-Saharan African Countries

10.21203/rs.3.rs-21562/v1 ◽

2020 ◽

Author(s):

Obianuju Nnadozie ◽

Isiaka Akande Raifu

Keyword(s):

Manufacturing Sector ◽

Value Added ◽

Policy Option ◽

Sub Saharan Africa ◽

Panel Estimation ◽

African Countries ◽

Dynamic Panel ◽

Information And Communication ◽

Sub Saharan ◽

Ssa Countries

Abstract This paper examines the nexus between infrastructure and manufacturing value added (MVA) in sub-Saharan Africa (SSA). It employs panel data for 34 SSA countries spanning 2003 to 2018. The empirical results obtained from the static and dynamic panel estimation techniques applied suggest that infrastructure is essential for the improvement of manufacturing value added in SSA. Furthermore, our findings reveal that the infrastructure-MVA nexus varies by infrastructure types (electricity, transportation, information and communication technology (ICT) and water and sanitation) and across the different sub-regions that make up SSA. This study therefore posits that massive investment in infrastructure is a viable policy option for enhancing the growth and development of the manufacturing sector in SSA.

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