nep-afr New Economics Papers
on Africa
Issue of 2008‒05‒31
seven papers chosen by
Suzanne McCoskey
George Washington University

  1. China’s Growing Economic Activity in Africa By Hany Besada; Yang Wang; John Whalley
  2. Multidimensional Poverty Dominance: Statistical Inference and an Application to West Africa By Yélé Maweki Batana; Jean-Yves Duclos
  3. Travailler à l’âge de la retraite ? Comparaison de la situation dans sept capitales ouest-africaines By Philippe Antoine
  4. Business Constraints and Growth Potential of Micro and Small Manufacturing Enterprises in Uganda By Esther K. Ishengoma; Robert Kappel
  5. Corruption and Growth: Exploring the Investment Channel By Léonce Ndikumana; Mina Baliamoune-Lutz
  6. On the Decomposition of Polarization Indices: Illustrations with Chinese and Nigerian Household Surveys By Abdelkrim Araar
  7. O que Impede a África de Gastar sua AOD? By Terry McKinley

  1. By: Hany Besada; Yang Wang; John Whalley
    Abstract: Trade between the whole of Africa and China (imports and exports summed) grew from $10.6 billion to $73.3 billion between 2000 and 2007, and between Sub-Saharan Africa and China from $7 billion to $59 billion over the same period. China is now Africa's third largest trading partner behind the EU and the US. The Chinese FDI stock in Africa has grown from $49 million in 1990 to $2.6 billion in 2006. On the basis of these data, one frequently hears the claim that China is now a dominant influence in Africa. Here we both evaluate such claims, and assess what factors underlay this phenomenon. We suggest that while the annual growth rates of trade and investment flows are high (around 30% per year sine the late 1990's), the levels are still considerably smaller than such claims might suggest. China in 2006 accounted for only $520 million of inward FDI compared to a total from all sources of $36 billion, around 1.4% of total FDI inflows to Africa; and only 8.6% of African exports and 9.6% of African imports. African interdependence with China thus remains proportionally smaller than that for most other geographical areas, but is growing rapidly. Factors behind this growth are discussed in the text.
    JEL: F13 F59 O53 O55
    Date: 2008–05
  2. By: Yélé Maweki Batana; Jean-Yves Duclos
    Abstract: This paper tests for robust multidimensional poverty comparisons across six countries of the West African Economic and Monetary Union (WAEMU). Two dimensions are considered, nutritional status and assets. The estimation of the asset index is based on two factorial analysis methods. The first method uses Multiple Correspondence Analysis; the second is based on the maximization of a likelihood function and on bayesian analysis. Using Demographic and Health Surveys (DHS), pivotal bootstrap tests lead to statistically significant dominance relationships between 12 of the 15 possible pairs of the six WAEMU countries. Multidimensional poverty is also inferred to be more prevalent in rural than in urban areas. These results tend to support those derived from more restrictive unidimensional dominance tests.
    Keywords: Stochastic dominance, factorial analysis, bayesian analysis, multidimensional poverty, empirical likelihood function, bootstrap tests
    JEL: C10 C11 C12 C30 C39 I32
    Date: 2008
  3. By: Philippe Antoine (DIAL, IRD, Dakar)
    Abstract: (English) Until these last years, "55 years" marked the retirement age in the majority of the French-speaking African capitals of West Africa. Only people who were employed in the modern private sector or in the administration could profit from a retirement pension. The increasing presence of active seniors is a question which currently occupies the social scene in West Africa. In addition, the increase in the retirement age is one of the major claims of the trade unions Men are still comparatively numerous working in the group age of 55-59 years (more than 60 % of the). Beyond 60 years old, an important proportion of individuals still work. As they get older, senior workers confine themselves more and more in the informal sector. Pensions distributed in West Africa are relatively moderate. There are not enough to cover family expenses which represent a burden until a relatively advanced age. _________________________________ (français) Jusqu’à ces dernières années « 55 ans » marquait l’âge de la retraite dans la plupart des capitales africaines francophones d’Afrique de l’Ouest. Cependant seules les personnes ayant exercé une activité dans les entreprises privées du secteur moderne de l’économie ou dans l’administration pouvaient bénéficier d’une pension de retraite. La présence plus tardive des personnes âgées au travail est une question qui occupe actuellement la scène sociale en Afrique de l’Ouest et le passage à un âge plus tardif de la retraite est une des revendications majeures des syndicats de la sous-région. Les hommes sont encore relativement nombreux encore à travailler dans le groupe d’âge 55-59 ans (plus de 60 %) ; au-delà de 60 ans une proportion importante d’individus travaille encore. Avec l’âge les travailleurs se cantonnent de plus en plus dans le secteur informel. Les pensions de retraite versées en Afrique de l’Ouest sont relativement modiques, en particulier pour ceux qui exerçaient en dehors du secteur public, et ne suffisent pas à couvrir les charges familiales qui pèsent sur ces personnes jusqu’à un âge relativement avancé.
    Keywords: Retraite, personnes âgées, ville, emploi, Afrique, Retirement, old people, city, labour market, Africa.
    JEL: J14 J26 J21
    Date: 2007–12
  4. By: Esther K. Ishengoma (Faculty of Commerce and Management, University of Dar es Salaam, Tanzania); Robert Kappel (GIGA German Institute of Global and Area Studies)
    Abstract: Ugandan micro- and small enterprises (MSEs) still perform poorly. The paper utilizes data collected in Uganda in March and April 2003 to analyze the business constraints faced by these MSEs. Using a stratified random sampling, a sample of 265 MSEs were interviewed. The study focuses on the 105 manufacturing firms that responded to all questions. It examines the extent to which the growth of MSEs is associated with business constraints, while also controlling for owners’ attributes and firms’ characteristics. The results reveal that MSEs’ growth potential is negatively affected by limited access to productive resources (finance and business services), by high taxes, and by lack of market access.
    Keywords: small enterprises, informal sector, growth, manufacturing, Uganda, productivity, business services
    JEL: D21 E26 G38 H25 L25 L26 L6 O12 O14
    Date: 2008–05
  5. By: Léonce Ndikumana (University of Massachusetts, Amherst, and UNECA, Addis Ababa); Mina Baliamoune-Lutz (University of North Florida)
    Abstract: This study investigates the impact of corruption on public and private investment in African countries as a way of exploring one channel through which corruption undermines growth. The empirical results indicate that corruption affects economic growth directly and through its impact on investment. We find that corruption has a negative and significant effect on domestic investment and that corruption affects public and private investment differently. The results indicate that corruption has a positive effect on public investment while it has a negative effect on private investment. The positive association between public investment and corruption supports the view that corrupt bureaucrats seek to increase capital expenditure (over maintenance expenditures) to maximize private gains (rent-seeking). In contrast, the results confirm that corruption discourages private investment, suggesting that corruption increases the costs of doing business while raising uncertainty over expected returns to capital. The results support the view that corruption hampers growth and call for institutional reforms to improve the quality of governance as a prerequisite for achieving investment-led growth. JEL Categories:
    Date: 2008–05
  6. By: Abdelkrim Araar
    Abstract: This paper explores the link between polarization and inequality and proposes some analytical methods to decompose the Duclos, Esteban, and Ray (2004) polarization index by population groups or income sources. In some cases, the decomposition methods were extend to the Esteban and Ray (1994) one. The main aim of these decomposition methods is to extend the interpretation derived from polarization indices to that of contribution components. Results drawn from Chinese data conclude that even if inequality has increased sharply during the last two decades, the pure polarization component was remained constant or even decreased on average. On the other hand, results from the 2004 Nigerian survey conclude that the population is spatially polarized, and this, based on geo-ecological zones. Furthermore, the two income sources, namely, Employment income and Non farm business income, significantly contribute to total polarization.
    Keywords: Polarization, Equity, Inequality, Decomposition
    JEL: D63 D64
    Date: 2008
  7. By: Terry McKinley (International Poverty Centre)
    Abstract: Atingir os Objetivos de Desenvolvimento do Milênio na África Subsaariana exige um aumento drástico da Ajuda Oficial para o Desenvolvimento (AOD) na região. Todavia, os governos têm sofrido restrições aos gastos da maior parte da verba recebida nos últimos anos. Se as doações não podem ser utilizadas, é natural que os doadores se perguntem: por que então enviar essa ajuda? A questão correta seria: o que está freando a utilização da ajuda recebida? (...)
    Keywords: O que Impede a África de Gastar sua AOD?
    Date: 2008–05

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