African Development Review-Revue Africaine De Developpement最新文献

Aligning with Sustainable Development Goal 10, this study probes whether quality institutions matter in the drive towards reducing income inequality through human capital. An unbalanced panel data on the Gini index (measure of income inequality), human capital index and institutional quality index drawn across 83 Latin America and sub-Saharan African (SSA) countries from 2010 to 2019 is used. For the most part, the consensus is that the interaction of human capital and quality institutions significantly reduces income inequality. For context, inequality reduces by −7.810 and −21.30 points for the full and SSA samples. Other findings reveal that the interaction effect is consistently negative at upper quantiles. Evidence from the margin plots reveals that the effect of human capital on inequality improves as institutional quality is strengthened. The downward trend of the plot within the 95% confidence interval shows that institutional quality enhances the impact of human capital on income inequality for the full sample and in SSA. This is a novel contribution to the literature as it suggests that quality institutions matter in the drive towards reducing the menace of income inequality. Policy recommendations are discussed.

The aim of our study is to analyze the effects of opportunity inequalities on internal armed conflict in developing countries. In a panel of 69 developing countries, over the period 2000–2020 and using the Logit model, we find a positive and significant relationship between inequality of opportunity and the risk of internal armed conflict in developing countries. The effects are higher in Africa than in Asia. As our results are validated by changing the dependent variable and estimation technique, we recommend, on the one hand, increasing investment in mobility and access to basic goods and services. On the other, we recommend the creation of decent jobs through increased investment, to improve developing countries' attractiveness to foreign direct investment as a source of formal jobs.

The thorny issue and contradictory conclusions on dividend payments and firm value are not ending any time soon. The existence of a divergence of findings in the literature suggests the need for further empirical studies on this subject matter. Therefore, this study focuses on how a firm's cash flow influences dividend payments in Ghana. Using data from 2015 to 2020, pooled ordinary least squares and random effects estimation, this study provides evidence of dividend payments in Ghana. The results show that dividend payments are influenced by a firm's net cash flow from operations, free cash flow to equity, firm size, and age. The relevant macroeconomic variables for dividend payments are inflation and gross domestic product growth. Another finding is that the more nonfinancial firms take on the characteristics of financial firms, the less dividends they pay. Managers of listed firms in Ghana should grow the size of their firms; however, this should be done in a manner not to expropriate value to managers as predicted in the Jensen agency problem associated with free cash flow.

In this study, the nexus between Foreign Direct Investment (FDI) and financial deepening is critically examined. The study employed a robust dynamic panel cross-sectionally augmented distributed lag method for 31 countries in sub-Saharan Africa (SSA). The results reveal that: (1) a strong significantly positive long run impact of FDI on financial deepening exists; (2) real gross domestic product (GDP), trade openness and government effectiveness stimulate the positive FDI–financial deepening nexus; (3) the strength of the FDI–financial deepening nexus also depends on the percentile position in the income distribution of SSA countries (countries in the upper strata of the income distribution evidently had stronger FDI–financial deepening relations than those in the lower strata and (4) real GDP, trade openness and government effectiveness also enhance financial deepening in SSA. The study recommends that governments in SSA should foster fiscal, financial and regulatory incentives for attracting FDI for improved financial depth in SSA by: strengthening the regulatory frameworks and institutions of governance through the removal of unwarranted governmental interferences in the administration of justice and electoral processes; removing multiple tax regimes; and stabilizing prices and exchange rate volatility via stimulating local productivity and guaranteeing the rule of law, political stability and security of life and property in the region.

Inspired by the recent drastic shift in international trade from traditional to global value chains, this study analyzed the effects of economic freedom and ease of doing business on participation and position of sub-Saharan Africa in global value chains. Panel data from 41 sub-Saharan African countries from 2000 to 2018 were used. The study utilized a tobit estimator along with a fixed effects estimator. The findings show that economic freedom—namely, better regulation and sound money—positively influence the countries' participation in global value chains. Moreover, improving ease of doing business, such as by decreasing customs duties and simplifying procedures to register new businesses, enhances the countries' level of participation and their efforts to move upstream along the global value chains. The results are robust to different specifications. Therefore, sub-Saharan African countries should promote economic freedom and ease of doing business to participate in and reap benefits offered by the current wave of globalization. Specifically, sub-Saharan African countries should further reduce the number of procedures required to register new businesses, decrease tariffs and non-tariffs barriers to trade in global value chains to enhance their participation and position along global value chains.

This study aimed to unveil the evolving landscape of digital financial inclusion in African countries during the post-COVID-19 era. We examined factors influencing the access and usage of digital financial services and identified population segments facing increased exclusion due to the digital divide. First, by applying principal component analysis to data collected at the country level from 39 African countries in 2014, 2017, and 2022, we developed a digital financial inclusion index. Second, the empirical research utilized a microlevel dataset of 29,042 adults from 29 countries, sourced from the World Bank's Global Findex 2021 database, employing the instrumental variable probit methodology. Comparative analysis showed improvements in digital financial inclusion rankings for Kenya, Lesotho, and Botswana, while Egypt, Sudan, Tunisia, and Niger experienced declines, indicating limited access. Our empirical findings suggest that certain groups, such as women and individuals with limited education and lower incomes, encounter obstacles in accessing digital financial services. Factors such as education level, labor market participation and access to technology and internet infrastructure emerged as crucial in promoting digital financial inclusion. Our sample's representative nature enhances the study's practical implications, guiding public policies and international institutions to accelerate digital financial inclusion in Africa.

This study examined the effects of public infrastructural development and industrialization on economic complexity in Africa, and how industrialization is moderating the effect of public infrastructural development on economic complexity. The study adopted the pooled ordinary least squares, the dynamic system generalized method of moments and the dynamic bias-corrected least squares dummy variable estimators with a panel of 34 African economies over the period 2010–2021. The findings revealed that public infrastructural development and industrialization contribute positively and significantly toward enhancing economic complexity in Africa. We also found that industrialization substantially moderates and enhances the influence of public infrastructural development on economic complexity. Furthermore, the results show that trade openness, foreign direct investment inflow, international tourism arrival and institutional quality are potent factors enhancing Africa's economic complexity, while the role of human capital remains muted. These findings suggest that African leaders and policy-makers can foster economic complexity across the continent by embracing policies that prioritize increased infrastructural development, industrialization, trade openness and foreign direct investment inflow while improving the quality of institutions within the region.

Following the rising wave of terrorism in Africa, particularly in the last decade, this study investigated the effect of terrorism on economic complexity in the region as well as the moderating role of military expenditure in the terrorism–economic complexity relationship. A panel of 34 African economies was used over the period 2010–2021. The study also used the dynamic system generalized method of moments framework. We find that the unconditional effect of terrorism on economic complexity in Africa is predominantly negative and significant, and that military expenditure in the region has been ineffective in moderating this adverse effect. This finding remained robust regardless of whether terrorism is measured by the number of terrorism incidents, fatalities, injuries, or hostages. However, our results showed that industrialization, urbanization, and governance institutional quality are potent channels for promoting economic complexity in Africa. Among others, the study emphasized the need for policymakers and leaders in Africa to collaborate at the level of the African Union to address the detrimental effects of terrorism on the continent.