Policymakers In Africa Research Articles

Inequality in Africa: Does injustice matter?

AbstractThe following study aims to investigate the impact of injustice on income inequality in Africa between 2000 and 2020. Both male and female injustice levels are evaluated using gender‐specific scores to indicate the injustice suffered by both genders. The study utilized the Gini and Palma ratios as proxies for income distribution inequality. After addressing error term‐related problems with the Newey‐West Standard Corrected Error approach, the findings indicate that injustice is a significant contributor to inequality in Africa, especially for females, with little evidence of male injustice. The results are consistent for both middle and low‐income countries that adopted the French civil law and English common law systems to govern their institutions. Additionally, the study found that educational development and basic welfare maintenance contribute to reducing inequality in Africa, which is exacerbated by many barriers to political inclusion. To address the gender bias in income distribution, policymakers in Africa should design policies that provide equal access to justice for both male and female populations. The study also suggests adopting policies that enhance human capital accumulation and political inclusion in‐state activities to create a safe, just, and equal environment.

Foreign aid, institutional quality, and income inequality in Africa: A dynamic panel threshold approach

This study examines the impact of foreign aid and institutions on income inequality in 23 African countries during the period from 2005 to 2017. The study used a newly proposed novel dynamic panel threshold technique. The results of the study found an institutional quality threshold value of 1.622. Below the threshold, foreign aid was found to positively and significantly influence income inequality. However, above the threshold, the coefficient of foreign aid was negative with statistical significance. This implies that foreign aid tends to diminish income inequality in the presence of quality institutions. The study also used the quantile regression method to check for robustness. It showed that the conclusion between aid and inequality is the same in most of the quantiles (0.1 and 0.2). The findings can be worthwhile for sketching proper aid policies to lessen inequality. Policymakers in Africa should prioritize establishing high-quality institutions and developing measures to improve existing ones. Thus, aid could potentially reduce income inequality. This study suggests that it is important to note that aid programs can be effective when tailored to the particular needs and circumstances of each beneficiary country, as one-size-fits-all methods may not produce the anticipated outcomes.

Applying History: Towards a Responsive Writing

This article discusses African historiography with an emphasis on Nigeria. It posits that the themes in African historiography have continued to evolve, with historians of different eras paying attention to a broad spectrum of issues. The need at one point was to recall the glory of Africa’s past, and to debunk Eurocentric bias and prejudice by early European writers of African history was a central theme in historical research on the continent. Thus, it was employed to address pressing issues of nationalism and to combat Afro-pessimism. The article suggests that contemporary historians can use historical writing to understand, analyse, and make recommendations for policymakers in Africa in such areas as governance, trade, and bilateral relations. Looking at contemporary issues, it has become clear that today’s historians can do more to contribute to finding solutions to some of the current challenges in different African communities.

Cryptocurrency and African fiat currencies: A peaceful coexistence?

AbstractThis study examines the asymmetric behaviour of Bitcoin relative to six major African fiat currencies (Egyptian Pound, Cedi, ZAR, Naira, Rupee and Dinar) for the period 10 August 2015 to 31 December 2022. The time and frequency information in the time series of the currencies were captured applying the ensemble empirical mode decomposition. The quantile regression (QR) and quantile‐in‐quantile regression (QQR) were applied on the decomposed series to examine the connections among the currencies at different currency regimes across time. The empirical results show that both QR and QQR can adequately capture the time‐varying asymmetric behaviour of the currencies across time. The results range from weak to very strong dependencies albeit both negative and positive across different quantiles. Our findings suggest that except for ZAR, Bitcoin is a viable alternative currency to African reserve currencies from the medium‐term since it can hedge depreciation and forex risk of the fiat currencies. Based on the findings of this study, we recommend that forex traders and policymakers in Africa should adopt Bitcoin as an alternative currency to African currencies in the medium‐term to mitigate currency crises in the continent.

The Intersection of Economic Inequality and Political Conflict in Africa: A Comprehensive Analysis

This study explores the interaction between economic inequality and political conflict in Africa. It investigates the relationship between economic inequality and political conflict in Africa and assesses how political conflicts affect economic inequality. The study also examines the role of political leaders in addressing conflicts in Africa. The study employs a qualitative research method, conducting a systematic literature review to gather and evaluate relevant studies on economic inequality and political conflict in Africa. The study applies the Human Needs theory, developed by John Burton, as a theoretical framework to comprehend the underlying causes of conflicts. This theory highlights unmet fundamental human needs like security, recognition, identity, and livelihood. The findings of the research indicate that economic inequality significantly contributes to political conflict in Africa, and conflicts have adverse effects on the African economy. The study recommends that policymakers in Africa should implement policies promoting economic equality to mitigate conflicts, and political leaders should take proactive measures to resolve conflicts on the continent.

Energy transition and pollution emissions in developing countries: are renewable energies guilty?

PurposeThis study aims to examine the effects of energy transition on pollution emissions in Africa. In addition, it explores the indirect channels through which energy consumption impacts environmental quality.Design/methodology/approachThe study uses system Generalised Method of Moments approach for a panel of 51 developing African countries over the 1996–2020 period.FindingsThe results show that fossil fuel and renewable energy consumption increase pollution emissions. The environment-degrading effect of renewable energy in Africa is however counter-intuitive, though the results are robust across regional economic blocks and income groups except for upper-middle-income countries where energy consumption is environment enhancing. Moreover, the results show that the environmental impacts of non-renewable energy consumption are modulated through financial development and information and communication technology (ICT) adoption, leading to respective positive net effects of 0.04460796 and 0.07682873. This is up to respective policy thresholds of 203.265 and 137.105 of financial development and ICT adoption, respectively, when the positive net effects are nullified.Practical implicationsContingent on the results, the study suggests the need for African countries to develop sound financial systems and encourage the use of green technologies, to ensure that energy transition effectively contributes to emissions reduction. Policymakers in Africa should also be aware of the critical levels of financial development and ICT, beyond which complementary policies are required for non-renewable energy consumption to maintain a negative impact on environmental degradation.Originality/valueFirstly, extant studies on the nexus between energy transition and environmental degradation in Africa are very sparse. Therefore, this study fills the existing research gap by comprehensively examining the effects of energy transition on pollution emissions across 51 African economies. Additionally, besides accounting for the direct environmental effects of energy transition, the current study accounts for the indirect channels through which the environmental impacts of energy transition are modulated. Hence, this study provides critical thresholds for the policy modulating variables, which enlighten policymakers on the necessity of designing complementary policies once the modulating variables attain the established thresholds.

From pollution to prosperity: Investigating the Environmental Kuznets curve and pollution-haven hypothesis in sub-Saharan Africa's industrial sector

Drivers of environmental change and policy processes are pushing the sub-Saharan African region to do more in the struggle against climate change as the region suffers most from climate change impact. To this end, this study investigates how the interaction effects of a sustainable financing model in energy use influence carbon emissions in Sub-Saharan African economies. It is based on the theory that energy consumption is determined by increased economic financing. Panel data analysis of thirteen countries from 1995 to 2019 is used to explore the interaction effect on CO2 emissions, taking a market-induced energy demand perspective. The study employed the fully modified ordinary least squares technique, removing all heterogeneity effects in a panel estimation. The econometric model was estimated with (and without) the interaction effect. The study finds support for the Pollution-Haven hypothesis and the Environmental Kuznets “inverted U-shaped” Curve Hypothesis in the region. It identifies a long-run relationship between the financial sector, economic activity, and CO2 emissions, with fossil fuel consumption in industrial activities increasing CO2 emissions by about 2.5 times. However, the study also reveals that the interactive effect of financial development can significantly reduce CO2 emissions, providing important implications for policymakers in Africa. The study suggests regulatory incentives to encourage banking credit intermediation for environmentally friendly energy sources. This research makes a valuable contribution to understanding the environmental impact of the financial sector in sub-Saharan Africa, an area that has received limited empirical attention. The findings highlight the relevance of the financial sector for policy formulation in addressing environmental issues in the region.

Effects of Economic Policy on Firm Performance in Developed and Developing Countries

This paper analyzes the effects of economic policy on firm performance in developed and developing countries, using a sample of firms classified by turnover. The methodology refers to the estimation of the dynamic panel fixed effects model. The results show that the priority economic policy tools based on price, balance of payments and employment control do not influence firm performance. However, debt increases the performance of firms in Africa. In high-income countries and China, it is savings and exchange rate policies that have a positive effect on firm performance. It is recommended that policymakers in Africa adopt a debt policy based on borrowing in compliance with ceilings and concessional interest rates so as not to increase debt service and suffocate the government’s cash flow. In developed countries, the savings policy must be maintained at the same pace as the mobilization of savings to meet the needs of growth sectors. Exchange rate policy must be able to absorb shocks and always adapt to the market.

Financial inclusion and economic growth: What roles do institutions and financial regulation play?

AbstractThe extant literature indicates that financial inclusion has a direct influence on economic growth. This has been examined by previous studies by analysing the link between financial inclusion and economic growth. This study uses the two‐step system GMM approach to investigate the moderating role of financial regulation and quality of institutions on the linkage between economic growth and financial inclusion in Africa, using balanced panel data of 52 African countries spanning 2002–2019. The findings reveal a number of things; (i) financial inclusion, financial regulation, and all proxies of institutional quality exert strong and significant effects on economic growth; (ii) institutional quality enhances the impact of financial inclusion on economic growth; iii. Financial regulation dampens the effect of financial inclusion on economic growth. Based on these findings, we recommend the following; (i) central, local governments, and policymakers should formulate public policy that promotes inclusive finance. Such policies should aim at removing barriers and constraints such as excessive customer identification requirements that hinder people from gaining access to finance; (ii) central governments and policymakers in Africa should refine policy that promotes the involvement of the citizenry in governance processes, promote accountability of public institutions, ensure effective governance systems, controls corruption, promote rule of law, and political stability and ensure quality legal and regulatory regimes; (iii) African central governments should fine‐tune policy aimed at strengthening institutions and the regulatory framework. By implication, strong, independent, and quality institutions coupled with sound financial regulatory framework is required to spur the growth of African countries.

Gender, political inclusion, and democracy in Africa: Some empirical evidence

AbstractThe objective of this study is to examine the effect of political inclusion on democracy in Africa. The results of the analyses through ordinary least squares, system generalized method of moments, IV Tobit and instrumental variables two stage least squares show that gender political inclusion enhances democracy in Africa. This result is robust across alternative specifications of political inclusion and democracy. The results equally stood when controlled for colonization and internal conflicts. In terms of policy implications, policy makers in Africa should enhance their fight for political inclusion as one of the gateways to promoting democracy. In this respect, national laws could be put in place which impose gender quotas in political positions in every country. Equally, the African Union could sign a convention on these quotas for respective countries to ratify.Related ArticlesBingham, Natasha. 2016. “Fighting for Our Cause: The Impact of Women's NGOs on Gender Policy Adoption in Four Former Soviet Republics.” Politics & Policy 44(2): 294–318. https://doi.org/10.1111/polp.12155.Hankivsky, Olena. 2013. “Gender Mainstreaming: A Five‐Country Examination.” Politics & Policy 41(5): 629–55. https://doi.org/10.1111/polp.12037.Herrick, Rebekah. 2008. “Gender Gap in Early Congressional Retirement.” Politics & Policy 32(3): 294–318. https://doi.org/10.1111/j.1747‐1346.2004.tb00189.x.

The Role of Internet on Agricultural Sector Performance in Global World

The Internet is considered to be an important factor in accelerating economic growth. There is a statistic regarding the inline of higher economic growth with higher Internet access. However, the impact of the Internet on agriculture as a real sector regarding its contribution on economic growth has not been explored in detail. The purpose of this study is to analyze the global effect of the Internet on agricultural sector performance. Static panel regression was used in this study by involving 126 countries using data from World Bank Open Data (2012–2019). Extended analysis was employed by applying the regression into two classifications, namely, countries by continent and the country composition of World Economic Outlook (WEO) groups. The result of this study shows that there exists a positive and significant global effect from Internet users, fixed broadband subscriptions, and secure Internet servers on agricultural sector performance. Additionally, the positive effect of Internet variables on agriculture was only found in Africa, Asia, and Oceania. In the country composition of WEO groups, there existed a positive and significant effect of Internet users and fixed broadband subscriptions on agricultural sector performance in economies classified as emerging and developing. This implies that the role of the Internet on agriculture is relatively higher in developing countries. Therefore, policymakers in Africa, Asia, Oceania, and emerging and developing economies (WEO Groups) must consider the role of Internet to improve agricultural sectors.

Mapping spatial and temporal dynamics in urban growth: The case of secondary cities in northern Ghana

ABSTRACT Urbanization induced growth of secondary cities presents several issues and challenges for sustainable development. Yet, secondary cities continue to receive less attention from scholars, city planners and policymakers in Africa. Understanding the spatial and temporal dynamics of secondary cities is critical for achieving Sustainable Development Goal 11. This paper examines the emerging spatial and temporal evolution of two secondary cities in Northern Ghana. The paper utilizes raster data (1990–2019) and applied landscape metrics to analyze spatial development in Wa and Bolgatanga municipalities along three concentric rings. The results show significant increase in built areas over the study period. Urban development in the two cities is becoming more or less fragmented, dispersed and contiguous. Inadequate spatial planning, weakly regulated development and uncoordinated land markets account for the fragmentated spatial forms. The two cities exhibit a monocentric form that fluctuates, is dynamic, and discontinuous. The paper reflects on the implications of the findings and suggests the need for a planned extension of secondary cities in Africa to generate efficient urban forms, curtail sprawl and protect the natural environment.

A Bibliometric Analysis of Solar Energy Forecasting Studies in Africa

Solar energy forecasting is considered an essential scientific aspect in supporting efforts to integrate solar energy into power grids. Moreover, solar energy forecasting plays an essential role in mitigating greenhouse gas emissions and conserving energy for future use. This study conducted a bibliometric analysis to assess solar energy forecasting research studies evolution at the continental (Africa) and southern Africa levels. Key aspects of analysis included (i) scientific research trends, (ii) nature of collaboration networks, (iii) co-occurrence of keywords and (iv) emerging themes in solar energy forecasting over the last two decades, between the years 2000–2021. The results indicate that solar energy forecasting research has, on average, expanded by 6.4% and 3.3% in Africa and southern Africa, respectively. Based on the study context, solar energy forecasting research only gained momentum in 2015, peaking in 2019, but it is generally still subtle. The scientific mapping illustrated that only South Africa ranks among the leading countries that have produced high numbers of published documents and also leads in contributions to the research area in both Africa and southern Africa. Three emerging topics were identified from the thematic map analysis—namely, “solar irradiance”, “artificial intelligence” and “clear sky”, which implies that researchers are paying attention to solar irradiance, using modelling techniques that incorporate machine learning techniques. Overall, this study contributes to scientific information on the potential bankability of renewable energy projects that could assist power utilities, governments and policymakers in Africa to enforce the green economy through accelerated decarbonisation of the energy systems and building relationships with developed countries for support and better transitioning to solar energy. From a Water–Energy–Food nexus perspective, the results of this work could assist the scientific community in Africa to take advantage of the inherent interconnectedness of water, energy and food resources, whilst also advancing the use of integrated solutions to shape the focus of solar energy research into a more systems thinking and transdisciplinary approach involving the interconnected primary resources and stakeholders pursuit of the Sustainable Development Goals.

Migrant Remittances and Food Security in Sub-Saharan Africa: The Role of Income Classifications

The pervasiveness of food insecurity in sub-Saharan Africa and other developing regions has resulted in increased emigration not only to wealthier countries within the continent but also to developed countries elsewhere in the world. A growing body of research has examined the welfare implications of remittances from international migrants for families left behind. A strand of that literature focuses on the association between international remittances and household food security. We contribute to this body of work by examining the variability of this relationship across three groupings of African countries, based on the World Bank's income classifications. Using data from the Afrobarometer Surveys, our results from an instrumental variable ordered probit regressions reveal that international remittances are positively and significantly correlated with household food security for all three country groupings. After correcting for endogeneity, we find that remittance-receiving households were 83.59 percent, 72.66 percent, and 26.06 percent more likely to report having never gone without enough food to eat in low-income, lower-middle income, and upper-middle income countries in sub-Saharan Africa, respectively. These findings suggest that central governments and policymakers in Africa should reform public policy in a way that strengthens the effectiveness and efficiency of international remittances transfer to reduce food insecurity across the continent.

A Panel Data Analysis into the Impact of Regulations and Supervision on the African Banking Profitability and Risk Profile

This paper investigated the effect of banking regulations and supervision on the profitability and risk profile of banks in selected African countries over the period 2009 to 2019. The study focused on 33 banks operating across 9 African countries, namely South Africa, Uganda, Kenya, Tunisia, Egypt, Namibia, Zambia, Nigeria and Ghana, as representative of the continent. It includes data from some of the major economies in the continent such as South Africa, Nigeria and Egypt to ensure that regulatory and supervisory developments in the continent are analysed appropriately. The analyses of the various interrelations were done using dynamic panel data modelling, Cointegration, and error correlation modelling approaches using Eviews statistical software. The study uses an unbalanced panel of commercial banks in the selected countries to estimate the model with both the return on equity and the return on assets as proxies for profitability. Overall, evidence shows that a well-regulated, stable and supervised banking sector is critical in the sustainable economic growth of the prospective economies. The findings of the study, however, provide an interesting outcome, in contrast to other studies, highlighting that the coefficient of the capital adequacy ratio is negative and statistically not significant to the profitability. This reflects the weak financial conditions in most African countries. The negative and statistically insignificant capital adequacy ratio could also be a reflection of the unacceptable risk profile of banks in the continent. Besides the literature reflecting that adjustment in the inflation rate improves banks’ profitability, this study contrasts with this view, a further reflection of the uniqueness of the banks operating environment in the continent. This output cautions banks in Africa on the profile of risks that they should take as this could impact negatively on their profitability during periods of increasing inflation. This again offers important policy implications for regulators of banks and policymakers in Africa regarding the regulations and supervisory frameworks that relate to on boarding of clients and management of the loan portfolios.

Natural resources and national productivity in Africa: are there differences in high and low globalized economies?

PurposeThis paper aims to examine the effect of natural resources on the national productivity of high and low globalized economies in Africa.Design/methodology/approachThis study uses two-step generalized method of moments dynamic panel data of 30 African economies between 2006 and 2016 to achieve the purpose of the study.FindingsThe results suggest that natural resources promote productivity within African economies regardless of the level of globalization. However, while natural resources have an overall enhancing effect on national productivity in both high and low globalized economies, the enhancing effect varies according to the forms of globalization. The findings of this study suggest that globalization can alter the nexus between natural resources and national productivity in Africa. The results imply that African Governments and their related policymakers can rely on globalization to promote the effect of natural resources on productivity of African economies.Practical implicationsThis result is good and welcoming news, especially when natural resources in Africa have been described by prior studies as a curse to the continent. While globalization can be a tool for policymakers in Africa to deploy the positive effect of natural resources on national productivity, they might as well be careful as to which form of globalization they pursue, given that different forms and different levels or extent (high or low) of globalization yields different results on the nexus between natural resources and national productivity.Originality/valueTo the best of the authors’ knowledge, this study is the first of its kind to examine how natural resources affect national productivity in high and low globalized economies, especially in Africa.

Foreign aid—Economic Growth Nexus in Africa: Does Financial Development Matter?

This study explored the role of financial development in foreign aid (measured by agriculture, humanitarian, health, economic infrastructure and services, and education aid) and economic growth relationship for 37 African countries spanning the 2002–2018 period. Using the instrumental variable generalized method of moments model, our findings indicated that while foreign aid impedes Africa’s growth, financial development spurs economic growth. The conditional effect analysis showed that financial development conditions foreign aid to spur economic growth. The country-specific analysis further showed that foreign aid has a higher growth elasticity in countries with relatively better financial systems, such as Mauritius, South Africa, Gabon, Tunisia, and Botswana, whilst the growth elasticity of aid is smaller in countries with a relatively weak financial system such as Malawi, Guinea Bissau, Sierra Leone, and the Democratic Republic of Congo. The study recommended the need for policymakers in Africa to implement innovative ways to improve domestic revenue mobilization. The study also recommended that policymakers in Africa should create an enabling environment that will enhance the development of Africa’s financial system to mitigate the adverse effect of aid on economic growth.

EFFECTS OF INTERNATIONAL TRADE ON ECONOMIC GROWTH OF ECONOMIC COMMUNITY OF WEST AFRICAN STATES (ECOWAS)

Economic literature identifies international trade as one of the channels through which sustainable economic growth can be achieved. For years, the relevance of trade in economic growth process has been one of the most commonly debated topics among economists and policy makers in Africa. This study investigates the effects of international trade on the economic growth of Economic Community of West African States (ECOWAS) from 2000 to 2018 across the 15 countries of the sub-region. Fixed effect model in a panel data environment was used for the analysis. The variables of interest are real gross domestic product, exports, imports, exchange rate, balance of payments and gross capital formation. The results show that exports, imports, exchange rate and balance of payments exert significant positive effects on economic growth of the ECOWAS, while gross capital formation exerts significant negative effect on growth of the economy of the countries. However, the independent variables jointly showed significant growth effect. Consequently, this study recommends that the ECOWAS should explore modern technology to transform their raw materials into intermediate export goods in order to increase the limited production and export base so as to become more competitive in international trade relations. Also, the imports of the sub-region should be skewed towards intermediate production inputs such as technology, machineries and chemicals which, when combined with the abundantly available human capital, would increase the production of value-added exports volumes, improve trading position and ultimately improve economic growth of the sub-region

Trends and Gaps in African Legislative Research: Major Topics from the 1960s–2021

Abstract This article takes stock of African legislative studies, focusing on trends and gaps between the 1960s and 2021. It begins with a discussion on the nature of African legislative research by reviewing common research topics on African legislature between the mentioned period from leading scholarly journals in the field before delving into the generational studies and their specific foci. Particular circumstances under which African legislative studies operated are also noted. A notable feature of African legislative scholarship is that most of them are a product of different critical junctures in historical contexts in Africa, which underscores the importance of context-specific variables and histories in discerning legislative policymaking in Africa. The article demonstrates that legislatures are emerging as vital players in governance in some countries more than others, thus informing the recent comparative discourses for African legislative studies. Although the obtainable studies offer insights into the structure and operation of African legislatures, most fail to delve deep into the design and utility of various legislative functions and processes. This calls for a more focused study on the capacity of legislative committees and how they function. This review attempts to provide insights that may inform such an endeavour.

Global uncertainty, economic governance institutions and foreign direct investment inflow in Africa

Based on the fact that Africa has not fared well in attracting foreign direct investments in the last decade compared to other regions of the world, especially during periods of high uncertainty occasioned by one crisis or the other, this study investigated: the impacts of global uncertainty and economic governance institutions on FDI inflow to Africa; the moderating effect of economic governance institutions on global uncertainty-FDI relationship in Africa; and other significant drivers of FDI inflow to Africa. The study used the system GMM modeling framework and a panel of 46 African economies over the period 2010–2019. The results indicate that global uncertainty has a significant dampening effect on FDI inflow to Africa, and economic governance institutions on the continent amplify this effect rather than mitigate it. The results further indicate that natural resource endowment, market size, and initial FDI inflows are robust drivers of FDI inflows to Africa, while the roles of financial development and trade openness remained muted. Overall, the study concludes that policymakers in Africa should take urgent steps to strengthen the quality of economic governance institutions as a means of mitigating the excruciating effect of global uncertainty on FDI inflows to Africa.