{"title":"Effect of Foreign Direct Investments on Industrialisation: The Case of China in Africa","authors":"Ding Chen, Aliyu Buhari Isah, U. Gummi","doi":"10.1093/jae/ejad026","DOIUrl":"https://doi.org/10.1093/jae/ejad026","url":null,"abstract":"\u0000 China's engagement in Africa's economic domain has sparked disagreement among researchers and the mainstream media on whether the engagement benefits Africa as a host. There are also ongoing concerns that the new China-Africa relationship is only benefiting China at the expense of Africa. In this paper, we examine the effect of China's FDI on industrialisation in Africa based on the instrumental variables Generalized Methods of Moment (IV-GMM) model, using a sample of 36 African countries and data spanning from 2003 to 2020. We find that China's FDI slightly promotes industrialisation in Africa. In isolation, the effect of China's FDI on industrialisation is larger in high-recipient countries of China's FDI than in low-recipient countries due to disparity in the absorptive capacities of the countries. However, we find that countries' characteristics such as domestic investment, financial development, infrastructure, human capital and institutional qualities, among others, play a significant role in promoting industrialisation in Africa. Therefore, we propose some important policy implications in line with the empirical findings.","PeriodicalId":51524,"journal":{"name":"Journal of African Economies","volume":null,"pages":null},"PeriodicalIF":1.6,"publicationDate":"2024-02-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139868060","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Effect of Foreign Direct Investments on Industrialisation: The Case of China in Africa","authors":"Ding Chen, Aliyu Buhari Isah, U. Gummi","doi":"10.1093/jae/ejad026","DOIUrl":"https://doi.org/10.1093/jae/ejad026","url":null,"abstract":"\u0000 China's engagement in Africa's economic domain has sparked disagreement among researchers and the mainstream media on whether the engagement benefits Africa as a host. There are also ongoing concerns that the new China-Africa relationship is only benefiting China at the expense of Africa. In this paper, we examine the effect of China's FDI on industrialisation in Africa based on the instrumental variables Generalized Methods of Moment (IV-GMM) model, using a sample of 36 African countries and data spanning from 2003 to 2020. We find that China's FDI slightly promotes industrialisation in Africa. In isolation, the effect of China's FDI on industrialisation is larger in high-recipient countries of China's FDI than in low-recipient countries due to disparity in the absorptive capacities of the countries. However, we find that countries' characteristics such as domestic investment, financial development, infrastructure, human capital and institutional qualities, among others, play a significant role in promoting industrialisation in Africa. Therefore, we propose some important policy implications in line with the empirical findings.","PeriodicalId":51524,"journal":{"name":"Journal of African Economies","volume":null,"pages":null},"PeriodicalIF":1.6,"publicationDate":"2024-02-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139808155","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"The Inflationary Impact of a Large Devaluation across the Income Distribution: The Case of Egypt in 2016","authors":"Shireen Alazzawi, Vladimir Hlasny","doi":"10.1093/jae/ejad025","DOIUrl":"https://doi.org/10.1093/jae/ejad025","url":null,"abstract":"Large-scale currency devaluations often result in rapid inflation, disproportionately affecting households with lower incomes, as they typically allocate a higher portion of their expenses to tradable goods. In this study, we examine cost-of-living changes of households across the income distribution in a relatively highly regulated, modest-inequality economy—Egypt—following the November 2016 devaluation of the Egyptian Pound when it depreciated by approximately 50%. We model the exchange rate pass through to domestic prices of various commodities, and the consumption responses by distinct economic groups, using true cost-of-living indices. We first quantify the exchange-rate pass-through to commodity prices, and then introduce a readily applicable methodology based on minimal data requirements to study the distributional implications for households’ cost of living and welfare, taking substitution effects and changes in preferences into consideration. Our findings reveal that over 30% of the rise in the cost of living of the average household was due to the devaluation, raising the amount of compensating variation necessary to keep households at their 2015 real welfare levels by 30% to 40% compared to the counterfactual scenario absent devaluation. These effects were more pronounced for some regions and among the poorest households. These disparities in welfare effects underscore the importance of designing and implementing targeted transfers to mitigate the negative impact of similar devaluations.","PeriodicalId":51524,"journal":{"name":"Journal of African Economies","volume":null,"pages":null},"PeriodicalIF":1.6,"publicationDate":"2024-01-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139586125","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Alexandra T Tapsoba, Jean-Louis Combes, Pascal Combes Motel
{"title":"Does Youth Resentment Matter in Understanding the Surge of Extremist Violence in Burkina Faso?","authors":"Alexandra T Tapsoba, Jean-Louis Combes, Pascal Combes Motel","doi":"10.1093/jae/ejad023","DOIUrl":"https://doi.org/10.1093/jae/ejad023","url":null,"abstract":"The year 2019 marked an unprecedented step in violence in Burkina Faso. Before 2018, attacks targeted central government officials and expatriates. In 2019, the victims of sexual assaults, attacks, abductions or forced disappearances and assassinations were mostly local civilians. The surge in these violent attacks against civilians generates population movements. As of 2023, internally displaced people represent about 10% of the total population in the country. Several observers point to the youth of the attackers. This study investigates the motives that could drive young people to resort to violence in the country. It aims to highlight youth resentment's effect on violence against civilians in the country as of 2019. It takes advantage of one of the latest nationwide United Nations Children’s Fund (UNICEF)-sponsored surveys conducted in Burkina Faso before some parts of the country became inaccessible because of attacks. Among other information, this survey collected data on youth resentment towards the ability of their kinship to fulfil their needs in 2018, namely before the shift in violence against civilians. We merge this survey into an original dataset that gathers data from the Armed Conflict Location and Event Data Project (ACLED), mining data from the MINEX project and distance data computed using Burkina Faso's roads information. The results of an event count model show that youth resentment matters in understanding the occurrence of conflicts. Moreover, the presence of mining companies, the remoteness of infrastructures, ethnic diversity and polarisation also significantly affect violence against civilians.","PeriodicalId":51524,"journal":{"name":"Journal of African Economies","volume":null,"pages":null},"PeriodicalIF":1.6,"publicationDate":"2024-01-24","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"139585823","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Linguère Mously Mbaye, Assi Okara, Massimiliano Tani
{"title":"Labour Mobility and Innovation in Africa","authors":"Linguère Mously Mbaye, Assi Okara, Massimiliano Tani","doi":"10.1093/jae/ejad020","DOIUrl":"https://doi.org/10.1093/jae/ejad020","url":null,"abstract":"Abstract We investigate whether short-term mobility differentially affects innovation in product or process through the help of a theoretical model, and carry out an empirical analysis with a focus on African countries using firm-level data from the World Bank Enterprise Survey. We find that labour mobility positively affects innovation, especially for products and services, supporting its use as an effective mechanism to diffuse productive knowledge and foster innovation. We also find that short-term mobility benefits low-technology sectors the most, and that mobility from high-income countries may be an effective way of leveraging innovation in high-technology sectors in Africa. The results are robust to a variety of approaches controlling for endogeneity, and support the adoption of labour mobility nationally and across Africa to encourage labour mobility to promote domestic innovation and productivity.","PeriodicalId":51524,"journal":{"name":"Journal of African Economies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-11-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135186118","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Conditional Political Cycles in Africa: Myth or Reality?","authors":"Christine O Strong","doi":"10.1093/jae/ejad019","DOIUrl":"https://doi.org/10.1093/jae/ejad019","url":null,"abstract":"Abstract This study tests for the presence of political cycles in Africa. Through an analysis encompassing data from 30 African nations over the period 1980–2020, we ask whether political incumbents in Africa rely on monetary and fiscal policy variables to improve their reelection prospects. In particular, we test for the existence of ‘conditional political cycles’, namely, we show that both government consumption and money growth go up during an election year, even when we account for critical institutional factors such as government attributes and political regimes. Our findings reveal a noticeable upswing in both government consumption and money growth during election years, a trend that holds consistent even after controlling for key institutional variables. Further exploration, however, unveils that this phenomenon is nuanced, particularly in the case of political monetary cycles; in particular, our analysis shows that when an African country is classified as a democracy during an election year, broad money falls. But although robust institutions can curtail the intensity of political monetary cycles, they do not exert a similar effect on fiscal variables. Finally, we test for the presence of ‘political credit cycles’ and find no empirical evidence that African incumbents manipulate credit markets to bolster their electoral outcomes.","PeriodicalId":51524,"journal":{"name":"Journal of African Economies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-10-25","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135218630","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Starting Strong: Investigating the Importance of Early Academic Performance for Adult Human Capital","authors":"Heidi Kaila, David E Sahn, Naveen Sunder","doi":"10.1093/jae/ejad018","DOIUrl":"https://doi.org/10.1093/jae/ejad018","url":null,"abstract":"Abstract We use a production function approach to investigate the factors that determine young adults' human capital outcomes in Madagascar and Senegal. Our study relies on unique and comparable panel data spanning over 15 years for both countries. We find that second-grade students' test scores are strong indicators of their French and math skills, as well as their educational attainment in their early twenties. Moreover, we observe that the association between second-grade skills and later-life outcomes is stronger among girls than boys, and in math test scores compared with French test scores. Our results emphasise the critical role of performing well during the early school years, as it predicts long-term outcomes, especially for vulnerable populations such as girls.","PeriodicalId":51524,"journal":{"name":"Journal of African Economies","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-09-26","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135719707","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Nutritional and Schooling Impact of a Social Protection Program in Ethiopia: A Retrospective Analysis of Childhood Exposure","authors":"M. Mendola, M. Negasi","doi":"10.1093/jae/ejad016","DOIUrl":"https://doi.org/10.1093/jae/ejad016","url":null,"abstract":"\u0000 This paper investigates the impact of a large-scale Ethiopian government social protection program on long-term anthropometric measures of nutrition status, education attainment and enrollment delay. Our research design uses unique administrative data on the program's regional coverage and combines differences in the intensity of the program across regions with differences across cohorts induced by the timing of the program. Our findings show that exposure to the program in early childhood leads to better nutrition status and, hence, higher human capital accumulation. The results are robust to different measures for program intensity and different estimation samples, empirical models and placebo tests.","PeriodicalId":51524,"journal":{"name":"Journal of African Economies","volume":null,"pages":null},"PeriodicalIF":1.6,"publicationDate":"2023-09-05","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47772561","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"Cash Transfers and Social Capital: Evidence from a Randomized Controlled Trial in Malawi","authors":"H. Mesfin, F. Cecchi","doi":"10.1093/jae/ejad017","DOIUrl":"https://doi.org/10.1093/jae/ejad017","url":null,"abstract":"\u0000 We examine the social capital implications of conditional and unconditional cash transfer (CCT) programs in Malawi, randomly assigning adolescent women and their households to either program or to a control group. Our results show that cash transfers have a positive aggregate effect on social capital, proxied by trust and gift giving. They also show positive intention-to-treat effects on both trust and gift giving in the short run but a negative spillover effect on gift giving in the long run. Moreover, we find that CCTs have greater positive effects on trust than the unconditional cash transfers (UCT). Further analyses reveal that adolescents with initial reciprocal beliefs drive the increase in trust. These results contribute to the current debate on whether CCTs or UCTs are better policy tools, adding the important ‘externality’ of social capital formation.","PeriodicalId":51524,"journal":{"name":"Journal of African Economies","volume":null,"pages":null},"PeriodicalIF":1.6,"publicationDate":"2023-08-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"46180436","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
{"title":"‘You Should Vote because I Say So!’ Influence towards Voting within Mozambican Households","authors":"Ana Vaz","doi":"10.1093/jae/ejad015","DOIUrl":"https://doi.org/10.1093/jae/ejad015","url":null,"abstract":"\u0000 How are the effects of voter education campaigns transmitted within the household? During the 2009 Mozambican elections, a field experiment implemented three voter education interventions: the distribution of a free newspaper, the creation of an SMS hotline to report electoral problems and a civic education campaign. Based on a relatively small sample of untreated individuals living with experimental subjects, this paper examines the diffusion of the interventions' effects within the household. The study finds evidence of spillover effects on interest in elections and turnout. But it finds no evidence of spillover effects on information about elections, nor evidence of spillover effects triggered by the delivery of the newspaper, the treatment most focused on the dissemination of information. On one hand, these findings show that voter education campaigns reach other individuals beyond the targeted subjects. On the other hand, they suggest that some voter education campaigns might boost turnout by increasing social pressure to vote rather than raising the level of information among voters. This paper highlights the need for additional research to probe unintended side effects of voter education campaigns.","PeriodicalId":51524,"journal":{"name":"Journal of African Economies","volume":null,"pages":null},"PeriodicalIF":1.6,"publicationDate":"2023-07-28","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"49464086","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}