nep-afr New Economics Papers
on Africa
Issue of 2011‒01‒03
fourteen papers chosen by
Quentin Wodon
World Bank

  1. Does China's Trade Expansion Help African Development? - A South-South Trade Model Approach By Yong HE
  2. Financial Development and Growth: A Positive, Monotonic Relationship? Empirical Evidences from South Africa By Jalil, Abdul; Wahid, Abu N. M.; Shahbaz, Muhammad
  3. Trend shocks and business cycles in Sub Saharan Africa By Claude Francis Naoussi; Fabien Tripier
  4. Adolescent childbearing experiences in Kenya: geographical and socioeconomic determinants By Aurora Angeli; Rosella Rettaroli; Angelina Mazzocchetti; Carla Pezzulo
  5. African Leaders: Their Education Abroad and FDI Flows By Amelie Constant; Bienvenue N. Tien
  6. District-level Spatial Analysis of Migration Flows in Ghana: Determinants and Implications for Policy By Tsegai, Daniel; Le, Quang Bao
  7. Signalling performance: Continuous assessment and matriculation examination marks in South African schools By Servaas van der Berg; Debra Shepherd
  8. Who Responds to Voluntary Cognitive Tests in Household Surveys? The Role of Labour Market Status, Respondent Confidence, Motivation and a Culture of Learning in South Africa By Hendrik van Broekhuizen; Dieter von Fintel
  9. Adoption of Improved Maize and Common Bean Varieties in Mozambique By Lopes, Helder
  10. ʼn Ongelyke Oes: Die Franse Hugenote en die vroeë Kaapse wynbedryf By Johan Fourie; Dieter von Fintel
  11. Got Technology? The Impact of Computers and Cell-phones on Productivity in a Difficult Business Climate: Evidence from Firms with Female Owners in Kenya By Nidhiya Menon
  12. Obstacles to Business, Technology Use, and Firms with Female Principal Owners in Kenya By Nidhiya Menon
  13. Technological Capability Building in Informal Firms in the Agricultural Subsistence Sector In Tanzania: Assessing the Role of Gatsby Clubs By Szogs, Astrid; Mwantima, Kelefa
  14. Empirical analysis of school attainment/progression in Cameroon. By TENIKUE Michel

  1. By: Yong HE (Centre d'Etudes et de Recherches sur le Développement International)
    Abstract: With the aim to explain the explosive growth of trade between China and Africa, especially the impacts of China's exportation on African countries, a simple South-South trade model is constructed to formulate the idea that for a technologically backward country to improve its production capability, when there exists nontrivial substitution effects, it is better to import from a South country which has superior technology, than from a North country with enormous technological advance. Then the Comtrade panel data are used to assess the impacts of imports from China (in comparison with those from the USA and France) on Sub-Saharan African manufactured exports (as proxies of their production performances). The results confirm the inference drawn from the model.
    Keywords: South-South trade, impact of Chinese exportation on Africa, technology spillover effects, intermediate goods, substitution effects.
    JEL: C23 F14 O33
    Date: 2010
  2. By: Jalil, Abdul; Wahid, Abu N. M.; Shahbaz, Muhammad
    Abstract: The objective of this article is to investigate the relationship between development of the financial sector and economic growth for South Africa. For this purpose, we data for 1965-2007 and set the estimation strategy under the ARDL framework. Importantly, four indicators for the financial developments are utilized to accomplish our tasks. We find a positive monotonic relationship between financial development and economic growth for South Africa. Trade openness and per capita real capital are found as the other important determinants of economic growth in South Africa.
    Keywords: Financial Development; Trade; Growth; South Africa; ARDL; Monotonic relationship
    JEL: O40 G21
    Date: 2010–12–24
  3. By: Claude Francis Naoussi (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272); Fabien Tripier (LEMNA - Laboratoire d'économie et de management de Nantes Atlantique - Université de Nantes : EA4272)
    Abstract: This article explores the role of trend shocks in explaining the specificities of business cycles in Sub-Saharan African (SSA) countries using the methodology introduced by Aguiar and Gopinath (2007) [Emerging Market Business Cycles: The Cycle Is the Trend Journal of Political Economy 115(1)]. We specify a small open economy model with transitory and trend shocks on productivity to replicate the differences in the business cycle behavior of output and consumption across countries, especially the excess volatility of consumption in SSA countries. Our results suggest a strong relationship between the weight of trend shocks in the source of fluctuations and economic development. The weight of trend shocks is (i) higher in SSA countries than in emerging and developed countries; (ii) negatively correlated with the level of income, the quality of institutions, and the size of the credit market; and (iii) uncorrelated with the aid received by countries, the ratio of trade-openness, the inflation rate, and government spending.
    Keywords: Business cycle; Permanent shocks; Growth; Africa; Small open economy
    Date: 2010–12–14
  4. By: Aurora Angeli (Università di Bologna); Rosella Rettaroli (Università di Bologna); Angelina Mazzocchetti (Regione Emilia Romagna); Carla Pezzulo
    Abstract: Sub-Saharan Africa has one of the highest level of teenage pregnancies in the world. Some studies on this topic highlight the presence of unmet reproductive health needs of adolescent in different regions. Improving maternal health has been established as a key development priority among the Millennium Development Goals, and upgrading reproductive and maternal health is usually associated with the eradication of inequality and poverty and with the presence of health care programs and services devoted to girls’ education. We attempt to investigate the geographical and socioeconomic determinants of both teenage pregnancies and maternal health behaviours among adolescent women in Kenya. We ascertain the influence of the availability of health care facilities mainly oriented to the specific needs of reproductive health. Main data are represented by 2003 Kenyan Demographic and Health Survey. In addition, the DHS data set collects Global Positioning System locators for each of the primary sampling units included in the samples that enable a deep geographical analysis. We perform a multivariate multilevel analysis to estimate the influence that individual, household, and community-level factors have on the risk of adolescent childbearing. Additionally, a spatial component allows for the presence and proximity of maternal health services. We expect that the availability of reproductive health facilities acts together with levels of socio-economic development, individual and household characteristics and community fertility norms, in influencing individual reproductive behavior at very young ages.
    Keywords: Kenya, gravidanze adolescenziali, salute materna, strutture sanitarie, modelli multilivello Kenya, teenage pregnancy, maternal health, health facilities, multilevel modelling, millennium development goals
    Date: 2010
  5. By: Amelie Constant; Bienvenue N. Tien
    Abstract: Leaders are critical to a country's success. They can influence domestic policy via specific measures that they enforce, and they can also influence international public opinion towards their country. Foreign Direct Investments are also essential for a country's economic growth. Our hypothesis is that foreign-educated leaders attract more FDI to their country. Our rationale is that education obtained abroad encompasses a whole slew of factors that can make a difference in FDI flows when this foreign-educated individual becomes a leader. We test this hypothesis empirically with a unique dataset that we constructed from several sources, including the Library of Congress and the World Bank. Our analysis of 40 African countries employs the robust technique of conditional quantile regression. Our results reveal that foreign education is a significant determinant of FDI inflows, beyond other standard characteristics. While intuitive, this result does not necessarily indicate sheepskin effects or superior human capital obtained abroad. Rather, it indicates the powerful role of the social capital, networks, and connections that these leaders built while they were abroad that they in turn mobilize and utilize when they become leaders.
    Keywords: FDI, Leaders' Educational level, return migration, Africa
    JEL: C31 C33 F21 I21
    Date: 2010
  6. By: Tsegai, Daniel; Le, Quang Bao
    Abstract: The present study investigates the determinants of inter-district migration flows over the 1995-2000 period in Ghana. A combination of socio-economic, natural and spatial âdistrict-levelâ attributes are considered as potential variables explaining the direction of migration flows. In addition to the ânetâ migration model, âinâ and âoutâ migration models are also employed within the context of the gravity model. Results in the three models consistently show that people move out of districts with less employment and choose districts with high employment rate as destinations. While shorter distance to roads encourages out-migration, districts with better water access seem to attract migrants. Generally, people move out of predominantly agrarian districts to relatively more urbanized districts.
    Keywords: Gross migration, Net migration, Inter-district migration flows, spatial analysis, Ghana, Africa, Community/Rural/Urban Development, Labor and Human Capital,
    Date: 2010–12
  7. By: Servaas van der Berg (Department of Economics, University of Stellenbosch); Debra Shepherd (Department of Economics, University of Stellenbosch)
    Abstract: Economists regard information and feedback as important ways for self-correction in a system. This study analyses one aspect of information and feedback in the South African education system. Continuous assessment (CASS) carries a 25% weight in the final matriculation (Grade 12) mark and, more importantly, provides feedback on performance that affects examination preparation and effort. Weak assessment in schools means that pupils are getting wrong signals that may have important consequences for the way they approach the final examination. Moreover, similarly wrong signals earlier in their school careers may also have affected their subject choice and career planning. This study analyses data on CASS and compares it to the externally assessed matric exam marks for three years for a number of subjects. There are two signalling dimensions to inaccurate assessments: (i) Inflated CASS marks give students a false sense of security that they are well-prepared for the matric exams, thereby leading to unrealistic expectations and diminished effort. (ii) A weak correlation between CASS and the exam marks means poor signalling in another dimension: Relatively good students may get relatively low CASS marks. This indicates poor reliability of assessment, as the examination and continuous assessment should both be testing the same mastery of the national curriculum. The paper analyses the extent of each of these two dimensions of weak signalling in South African schools, by subject, province, socio-economic background of schools, and public versus independent schools. The analysis draws disturbing conclusions for a large part of the school system.
    Keywords: Economics of Education, assessment, asymmetric information, South Africa
    JEL: I21 D82
    Date: 2010
  8. By: Hendrik van Broekhuizen (Department of Economic, University of Stellenbosch); Dieter von Fintel (Department of Economic, University of Stellenbosch)
    Abstract: Both South Africa’s labour market and education system were directly influenced by the separate development policies of the apartheid regime. To this day, great inequalities persist in both domains. South Africa’s performance in standardized international test scores (such as TIMMS) is poor even relative to most developing countries. Furthermore, the better quality of outcomes in former white schools still leaves learners from former black schools at a disadvantage that feeds through to severe labour market inequalities. This study is the first in a series of papers that attempts to understand the role of school quality on labour market outcomes. Here we scrutinize the measurement of numeracy test scores in the National Income Dynamics Survey (NIDS) of 2008, particularly in light of potential sample selection issues. While this survey measures standard welfare and labour market indicators, it is one of the first in South Africa to also ask respondents to complete a concurrent numeracy test. Response rates on this module were particularly low, given that the test was taken on a voluntary basis. We develop a basic empirical model to understand who is likely to take the test. We postulate that discouraged workers’ low propensity to take the test is correlated with their reduced motivation to undertake job search, that the searching unemployed are highly motivated to take the test (as they wish to gauge their ability or practice assessments while embarking on the job search process), the poorest among the self-employed face severe time opportunity costs (as their low incomes are less secure than those of salaried workers) and the richest amongst the employed exhibit an income effect (in that the time opportunity costs of their high incomes reduce their willingness to respond to the numeracy test). Furthermore, locational effects suggest that those residing in geographical “points of entry” into the labour market are also more likely to take the test. The young (who are still in education) and the most educated (in the whole population) also tend to answer the test more readily. The latter observations indicate that some form of confidence in respondents’ own abilities drives their response patterns. To explain these observed features, we construct composite indices of motivation/emotional well-being and individuals’ confidence in their writing abilities using multiple correspondence analysis. While each of these psychological and behavioural factors is a strong predictor of test response, they do not entirely eliminate the independent contributions of each of the observed influences mentioned above. Coefficient magnitudes of each of the sociodemographic variables are, however, reduced, indicating that the particular behavioural influences introduced in later models tell some of the story. Additional uncaptured behavioural and motivational factors are therefore investigated. Firstly, we investigate the role of survey fatigue (by controlling for the time it took to complete the survey before the test was administered), which plays an important role in the black and coloured subpopulations. It furthermore explains why the wealthiest amongst the formally employed are less likely to complete the numeracy test. However, surprisingly, “pseudoaltruistic” effects appear amongst the (wealthier) white population, in that the longer the duration of the preceding questions, the more likely they are to care about answering the test. However, this result cannot be generalized to the whole white population, as response rates were very low among this group. Secondly, (household) peer effects are strong throughout the population, suggesting that a culture of learning is pivotal in understanding response patterns. The results of this paper suggest that broad sociodemographic and labour market features remain important determinants of test response, even after controlling for behavioural features. This suggests that subsequent labour market work must take these drivers into account to avoid the risk of sample selection bias.
    Keywords: education, behavioural economics, survey design, voluntary assessment, numeracy, survey non-response, sample selection bias, respondent confidence, motivation, culture of learning, South Africa
    JEL: C81 I21
    Date: 2010
  9. By: Lopes, Helder
    Abstract: Household adoption of new agricultural technologies, including improved maize and bean varieties in Mozambique, is still relatively low. As a result, the average maize and common bean production remains low. This study identifies factors that are associated with householdsâ adoption of improved maize and bean varieties, using Trabalho de Inquérito Agrícola (TIA) 2007 data and the probit model to estimate the likelihood of household adoption of improved varieties of maize and common beans at both the national and regional levels. At the national level, the results indicate that household headâs education, access to extension services and credit are associated with the householdâs adoption decision. However, association membership is negatively associated with the adoption decision. Education and extension are only statistically significant for the improved maize analysis. These findings suggest that households who had access to support services are more likely to adopt improved varieties. Household adoption of improved maize and bean varieties could be increased from the current 12% and 15% percent adoption rates, respectively, if 1) the current extension programs are strengthened to better respond to householdsâ information needs, as well as to serve more households in different geographical areas, and 2) household accessâ to credit is expanded.
    Keywords: Agricultural and Food Policy, Food Security and Poverty, International Development, Production Economics, Productivity Analysis, Research and Development/Tech Change/Emerging Technologies,
    Date: 2010
  10. By: Johan Fourie (Department of Economics, University of Stellenbosch); Dieter von Fintel (Department of Economics, University of Stellenbosch)
    Abstract: Although Van Riebeeck already produced the first wine at the Cape in 1659, the arrival of French Huguenots during 1688/89 gave considerable impetus to Cape wine production. The reasons for this remain unclear. By using quantitative production data over more than a century of European settlement, we show that a subgroup of Huguenots – specifically those originating from wine producing regions in France – produced significantly more wine and more productively than the other settlers. Standard factors of production do not explain the difference: the knowledge, skills and secrets of viticulture allowed these Huguenots to produce quality wine, an invaluable asset in the fight against scurvy on the long ship voyages between Europe and the East. These competitive advantages were passed down over generations, so that, even a century after arrival, the families with the initial advantage were still more adept at wine-making.
    Keywords: Kaapkolonie, Suid-Afrika, VOC, Hugenote, wynbou, slawe, Cape colony; South Africa; VOC; Huguenots; viticulture; viniculture; wine making; slaves
    JEL: N37 D31 D63
    Date: 2010
  11. By: Nidhiya Menon (Department of Economics, Brandeis University)
    Abstract: Firms in Kenya rely on technologies such as computers, cell-phones, and generators to overcome constraints associated with regulations, infrastructure, security, workforce, corruption, and finance. This study shows that such reliance has significant positive impacts on productivity as measured by value-added per worker, especially for firms with female principal owners. The exogenous component of technology ownership is isolated by using information on the regional presence of missionary schools from Kenya’s colonial past, as well as geographical indicators such as rainfall, changes in forest cover, and average regional elevation. Results indicate that for firms with female owners, technology adoption improves value-added per worker by about 49 percentage points. It is also statistically evident that for such firms, the ownership of technologies such as computers, cell-phones, and generators succeeds in mitigating the costs of business obstacles. For male-owned firms, such patterns are absent.
    Keywords: Technology, Computers, Cell-phones, Business Obstacles, Kenya, Firms, Female Owners
    JEL: O14 O33 L22 N37
    Date: 2010–12
  12. By: Nidhiya Menon (Department of Economics, Brandeis University)
    Abstract: Data on 778 establishments indicates that firms in Kenya rely on technologies such as computers, generators, and cell-phones to conduct operations when regulations, infrastructure, security, workforce, corruption, and finance pose significant hurdles in the business environment. Obstacles related to regulations, security, and workforce, increase the probability of technology ownership, whereas obstacles related to infrastructure in particular, reduces the probability that firms own technology. Results indicate that while all firms rely on technology in the face of regulatory and other obstacles, those with female principal owners experience net effects that are statistically distinct from those experienced by their counterparts. A gender-of-owner disaggregated Oaxaca-Blinder type decomposition of differences in technology ownership indicates that up to 18% of the total gap is unexplained by differences in measurable characteristics between firms that are female-owned and those that are not, suggesting that female-owned firms may own technology to a higher level than is warranted by their observed covariates.
    Keywords: Obstacles to Business, Technology, Kenya, Firms, Female Owners
    JEL: O14 O12 L14 O55
    Date: 2010–12
  13. By: Szogs, Astrid (ATPS, Tanzania); Mwantima, Kelefa (UDSM, University of Dar es Salaam)
    Abstract: We use a case study approach to examine whether new knowledge and technological capabilities can be acquired by a set of informal firm operating in the agricultural subsistence sector in Tanzania as a result of interaction with the College of Engineering and Technology at the University of Dar es Salaam. We find that by becoming members of Gatsby Club, firms have been introduced to important new organisations which assisted in the process of new knowledge acquisition. Technological capabilities have mainly been improved but also acquired; mainly at basic level.
    Keywords: Technological capabilities; Knowledge acquisition; Informal firm; Agricalture sector; Tanzania
    JEL: D80 O30 O39 O55 Q16
    Date: 2010–03–01
  14. By: TENIKUE Michel
    Abstract: In Cameroon, only 1/3 of children progress to secondary education. This paper estimates a sequential model of school attainment to investigate the role played by family background and individual characteristics in keeping children at school up to the end of secondary school. Using data of the 2001 Cameroon Household survey, we find that while parental wealth has no effect on the probability to enter primary school. It is however a good predictor of completing primary and secondary education. The lack of schools supply reduces school progression, particularly the lack of secondary schools hinders primary school entry. Finally, we find that male children are more likely to stay at school up to the end of secondary education.
    Keywords: Schooling; Sequential
    Date: 2010–12

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