nep-afr New Economics Papers
on Africa
Issue of 2006‒02‒05
eight papers chosen by
Suzanne McCoskey
Foreign Service Institute, US Department of State

  1. Governance, Democracy and Poverty Reduction: Lessons drawn from household surveys in sub-Saharan Africa and Latin America By Javier Herrera; Mireille Razafindrakoto; Francois Roubaud
  2. Export led growth, pro-poor or not? Evidence from Madagascar ' s textile and apparel industry By Nicita, Alessandro
  3. Remittances and poverty in Ghana By Adams, Richard H. Jr.
  5. The development of the Huambo Province in Angola - The application of a spatial interaction model to simulate the movement from autarky to external integration By Silvia Amaral; Tomaz Dentinho
  6. The impact of regional trade agreements and trade facilitation in the Middle East and North Africa region By Dennis, Allen
  8. WAGE AND HUMAN CAPITAL IN EXPORTING FIRMS IN MOROCCO By Christophe Muller; Christophe Nordman

  1. By: Javier Herrera (DIAL, Paris); Mireille Razafindrakoto (DIAL, Paris); Francois Roubaud (DIAL, Paris)
    Abstract: Public statistics face quite a challenge when it comes to measuring new dimensions of development (institutions, governance, and social and political participation). To take up this challenge, modules on Governance, Democracy and Multiple Dimensions of Poverty have been appended to household surveys by National Statistics Institutes in twelve African and Latin-American developing countries. This paper presents the issues addressed and the methodological lessons learnt along with a selection of findings to illustrate this innovative approach and demonstrate its analytic potential. We investigate, for instance, the population’s support for democratic principles, the respect for civil and political rights and the trust in the political class; the “need for the State”, particularly of the poorest; the extent of petty corruption; the reliability of expert surveys on governance; the perception of decentralisation policies at local level; the level and vitality of social and political participation, etc. The conclusive appraisal made opens up prospects for the national statistical information systems in the developing countries. The measurement and tracking of this new set of objective and subjective public policy monitoring indicators would benefit from being made systematic.
    Keywords: Africa, Latin America, Democracy, Monitoring Mechanism, Household Surveys,
    JEL: I31 I32 I38 H11 D73 O54 O55
    Date: 2006–01–06
  2. By: Nicita, Alessandro
    Abstract: Madagascar ' s textile and apparel industry has been among the fastest growing in Sub-Saharan Africa. Fueled by low labor costs, a fairly productive labor force, and preferential access to industrial countries, Madagascar ' s exports of textile and apparel products grew from about US$45 million in 1990 to almost half a billion in 2001. The impact of this export surge has been large in terms of employment and wages, but less so in terms of poverty reduction. To address the concern of whether the poor benefit and to what extent, the author follows a new approach to identify the beneficiaries of globalization and to quantify the benefits at the household level, so as to understand which segments of the population benefit most and which, if any, are marginalized. The analysis focuses on the labor market channel which has been recognized as the main transmission between economic growth and poverty. The methodology uses household level data and combines the wage premium literature with matching methods. The results point to a strong variation in the distribution of the benefits from export growth with skilled workers and urban areas benefiting most. From a poverty perspective, export-led growth in the textile and apparel sector has only a small effect on overall poverty. This study points to two reasons for this. First, a large majority of the poor are unable to enjoy the new employment opportunities, given their lack of skills sought by the expanding textile and apparel export industry. Second, most of the poor reside in rural areas where the employment effect is small. The results indicate that the effects of an increase in exports of textiles for poverty reduction are felt only in urban areas, mostly through job creation. Some of the urban poor are good candidates for finding employment in the expanding sector. But the urban poor are likely to find employment only in unskilled jobs. Given that unskilled wages are kept low by a large reserve labor sector, the gains are limited, and the overall impact on poverty is small. More generally, the results of this study suggest that two factors are required if export-led economic growth is to significantly reduce poverty. First, growth and job creation must not be restricted to a few geographic areas but need to reach areas where the majority of the poor live. Second, poor people must be assisted in obtaining the skills sought by expanding industries.
    Keywords: Labor Markets,Pro-Poor Growth and Inequality,Water and Industry,Economic Theory & Research,Economic Conditions and Volatility
    Date: 2006–02–01
  3. By: Adams, Richard H. Jr.
    Abstract: The author uses a large, nationally representative household survey to analyze the impact of internal remittances (from Ghana) and international remittances (from African and other countries) on poverty in Ghana. With only one exception, he finds that both types of remittances reduce the level, depth, and severity of poverty in Ghana. But the size of the poverty reduction depends on how poverty is being measured. The author finds that poverty is reduced more when international, as opposed to internal, remittances are included in household income, and when poverty is measured by the more sensitive poverty measures-poverty gap and squared poverty gap. For example, the squared poverty gap measure shows that including international remittances in household expenditure (income) reduces the severity of poverty by 34.8 percent, while including internal remittances in such income reduces the severity of poverty by only 4.1 percent. International remittances reduce the severity of poverty more than internal remittances because of the differential impact of these two types of remittances on poor households. Households in the poorest decile group receive 22.7 percent of their total household expenditure (income) from international remittances, as opposed to only 13.8 percent of such income from internal remittances. When these " poorest of the poor " households receive international remittances, their income status changes dramatically and this in turn has a large effect on any poverty measure-like the squared poverty gap-that considers both the number and distance of poor households beneath the poverty line.
    Keywords: Remittances,Economic Conditions and Volatility,Gender and Development,Small Area Estimation Poverty Mapping,Poverty Lines
    Date: 2006–02–01
  4. By: Marcio José Vargas Cruz; Cássio Frederico Camargo Rolim
    Abstract: This research had like general goal to identify the determinants of the international tourism flow, seeking diagnostic the main restrictions to the expansion of this sector in the countries in development, utilizing a comparative analysis for the regions of the South America, Africa and South of the Asia. To be specified the determinants of the international tourism flow, was applied the econometrics instrumental, aiming to establish its empirical evidence. In the analysis was utilized the panel model because it´s shown adequate to the objective of identify the prominent factors of generalized form. Furthermore, this paper discuss the performance of the countries of the South America, Africa and South of Asia in the international tourism, with base in the determinant specified, seeking identify the empirical coherence of these general determinants in case of these countries and comparing the specificities and homogeneity between these regions, constituted by countries in development. The result of the study aims that the income is a fundamental determinant for explain the emission of tourists and there are indications of an elevated elasticity, what is translated in empirical coherence. Referring to the tourism attractive, we found the relevant paper of the risk related to the security and of the development of the country, identified through of the Human Development Index - HDI. The comparative analysis between the regions of the South America, Africa and South of the Asia, showed that the performance of these countries show consistency with the general determinants, in function of their conditions, for example, their geographic distance from the rich countries.
    Date: 2005–08
  5. By: Silvia Amaral; Tomaz Dentinho
    Abstract: Huambo province in Angola has been detached from the outside world since the begining of the nineties. First due to the civil war in Angola and from then on due to the degradation of the roads and destruction of the railways. Furthermore there is the lack of integration of the province itself due to transport difficulties and human desertification. The objective of this paper is to understand the role of the roads network and the distribution of public funding in the revival of the economy in the Province of Huambo. First we present a review of the literature that stresses that one of the major causes of poverty due to war is related to the lack of accessibility. Then we formulated, calibrate a spatial interaction model for the Huambo City and Province where the degree of openness of the economy can be explicitated. Finaly we simulate the model for different scenarios of road network and distrubution of public funds.
    Date: 2005–08
  6. By: Dennis, Allen
    Abstract: The Middle East and North Africa (MENA) region ' s trade performance over the past two decades has been disappointing. Efforts to boost trade through a plethora of regional trade agreements (RTAs) are underway. This study examines the potential contribution of regional trade agreements, as well as trade facilitation improvements, in enhancing the development prospects of the region. Using the Global Trade Analysis Project (GTAP) model and database, both intra-regional integration and integration with the European Union are observed to have a favorable impact on welfare in the MENA region. The welfare gains from integrating with the European Union are observed to be at least twice as much as intra-regional integration. Furthermore, these welfare gains are observed to at least triple when the implementation of the RTAs is complemented with trade facilitation improvements.
    Keywords: Free Trade,Trade Law,Trade Policy,Economic Theory & Research,Trade and Regional Integration
    Date: 2006–02–01
  7. By: Christophe Muller (Universidad de Alicante)
    Abstract: It is not known to what extent welfare measures result from seasonal and geographical price differences rather than from differences in living standards across households. Using data from Rwanda in 1983, we show that the change in mean living standard indicators caused by local and seasonal price deflation is moderately significant at every quarter. By contrast, the differences in poverty measures caused by this deflation can be considerable, for chronic as well as transient or seasonal poverty indicators. Thus, poverty monitoring and anti-poverty targeting can be badly affected by inaccurate deflation of living standard data. Moreover, when measuring seasonal poverty, the deflation based on regional prices instead of local prices only partially corrects for spatial price dispersion. Using annual local prices instead of quarterly local prices only yields a partial deflation, which distorts the measure of poverty fluctuations across seasons and biases estimates of annual and chronic poverty.
    Keywords: Measurement and Analysis of Poverty, Income Distribution, Personal Income Distribution
    JEL: I32 O15 D31
    Date: 2005–03
  8. By: Christophe Muller (Universidad de Alicante); Christophe Nordman (DIAL, París)
    Abstract: We study the relationship of wages and education and training practices in Morocco in a context of trade and liberalisation reforms in a matched worker-firm data of eight exporting firms in two industrial sectors: Metallurgical-Electrical industries and Textile-Clothing. We find that the specific characteristics of the surveyed firms little affect worker wages. Moreover, the textile sector does not appear to be a significant channel for promoting skills in the economy. The minimal wage legislation is found to exert a positive pressure on wages. Also, some evidence of gender wage gap exists in the data. In these data, the effects of education and experience on wages are quite limited below the third quantile of wages, as well as the role of apprenticeship. In contrast, On-the-Job Training (OJT) much contributes to labour productivity as measured by wage levels. Most of the OJT is concentrated in the Metallurgical-Electrical industries. Education is positively correlated to OJT. Moreover, estimates of explanatory relationships of task organisation (chain gangs, teams, supervision and executive workers) show the powerful sector and educational determinations of job organisation in the firms. Then, our results suggest that the impact of worker education may take indirect routes and not only appear through education coefficients in wage regressions.
    Keywords: wage, returns to human capital, matched worker-firm data, quantile regressions, Tunisia
    Date: 2005–04

This nep-afr issue is ©2006 by Suzanne McCoskey. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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