Government size, institutional quality and economic welfare in Africa

IF 1.9 Q2 ECONOMICS

INTERNATIONAL JOURNAL OF SOCIAL ECONOMICS Pub Date : 2024-07-25 DOI:10.1108/ijse-01-2024-0075

Mark Kunawotor, Godson Ahiabor, Eric Yobo

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引用次数: 0

Abstract

Purpose

Most African countries operate large government sizes but with little corresponding economic outcomes. Institutional economics however, show that strong institution is fundamental in promoting economic growth. This study examines the linkages between government size, institutional quality and economic welfare in Africa.

Design/methodology/approach

This study deploys the System Generalized Method of Moments estimation strategy on panel data of 52 African economies from 2000–2018.

Findings

The result shows that government size has a negative impact on economic welfare, while institutional quality has a positive impact on economic welfare. The interaction of government size and institutional quality shows a positive impact on economic welfare, signifying synergy and complementarity. Thus, strong institutions counteract the adverse effects of large government size on economic welfare.

Practical implications

To promote human development and economic welfare, and attain key Sustainable Development Goals such as good health and well-being, quality education, decent work and economic growth, African policy makers need to keep their government sizes at optimal levels and promote strong institutions.

Originality/value

This paper provides first-hand empirical evidence of the relevance of institutional quality in counteracting the adverse influence of large government size in Africa. It determines the thresholds of government size and uses a composite index as proxy for same. In addition, this study uses the World Governance Indicators and the Fraser Institute Economic Freedom Index as alternative measures of institutional quality and Gross Domestic Product per capita and Human Development Index as proxies for economic welfare.

Peer review

The peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-01-2024-0075

查看原文本刊更多论文

非洲的政府规模、机构质量和经济福利

目的大多数非洲国家的政府规模庞大，但相应的经济成果却很少。然而，制度经济学表明，强有力的制度是促进经济增长的根本。本研究探讨了非洲政府规模、制度质量和经济福利之间的联系。研究结果结果表明，政府规模对经济福利有负面影响，而制度质量对经济福利有正面影响。政府规模与制度质量的交互作用对经济福利产生了积极影响，表明两者具有协同性和互补性。为了促进人类发展和经济福利，实现主要的可持续发展目标，如良好的健康和福利、优质教育、体面工作和经济增长，非洲的政策制定者需要将政府规模保持在最佳水平，并促进强有力的机构。本文确定了政府规模的临界值，并使用综合指数作为临界值的代表。此外，本研究还使用世界治理指标和弗雷泽研究所经济自由度指数作为衡量制度质量的替代指标，并使用人均国内生产总值和人类发展指数作为经济福利的替代指标。同行评审本文的同行评审历史可在以下网址查阅：https://publons.com/publon/10.1108/IJSE-01-2024-0075。

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来源期刊

INTERNATIONAL JOURNAL OF SOCIAL ECONOMICS ECONOMICS-

CiteScore

3.20

自引率

5.30%

发文量

期刊介绍： The International Journal of Social Economics publishes original and peer-reviewed theoretical and empirical research in the field of social economics. Its focus is on the examination and analysis of the interaction between economic activity, individuals and communities. Social economics focuses on the relationship between social action and economies, and examines how social and ethical norms influence the behaviour of economic agents. It is inescapably normative and focuses on needs, rather than wants or preferences, and considers the wellbeing of individuals in communities: it accepts the possibility of a common good rather than conceiving of communities as merely aggregates of individual preferences and the problems of economics as coordinating those preferences. Therefore, contributions are invited which analyse and discuss well-being, welfare, the nature of the good society, governance and social policy, social and economic justice, social and individual economic motivation, and the associated normative and ethical implications of these as they express themselves in, for example, issues concerning the environment, labour and work, education, the role of families and women, inequality and poverty, health and human development.