nep-afr New Economics Papers
on Africa
Issue of 2012‒10‒13
24 papers chosen by
Quentin Wodon
World Bank

  1. Working Paper 146 - Bank Financing to Small and Medium Enterprises in East Africa: Findings of a Survey in Kenya, Tanzania, Uganda and Zambia By AfDB
  2. Working Paper 149 - Accounting for Poverty in Africa: Illustration with Survey Data from Nigeria By AfDB
  3. Working Paper 151 - The Dynamics of Inflation in Ethiopia and Kenya By AfDB
  4. Working Paper 148 - Role of Fiscal Policy in Tackling the HIV/AIDS Epidemic in Southern Africa By AfDB
  5. Working Paper 147 - Gold Mining in Africa-Maximizing Economic Returns for Countries By AfDB
  6. Negative Economic Shocks and Child Schooling: Evidence from Rural Malawi By Asma Hyder; Jere R. Behrman; Hans-Peter Kohler
  7. Successful inflation targeting in Mozambique despite vulnerability to internal and external shocks By Andersson, Per-Åke; Sjö, Bo
  8. Working Paper 144 - An Analysis of the Impact of Financial Integration on Economic Activity and Macroeconomic Volatility in Africa within the Financial Globalization Context By AfDB
  9. The Contribution of Agricultural Economics to Price transmission Analysis and Market Policy in Sub-Sahara Africa: What Does the Literature Say? By Amikuzuno, Joseph; Ogundari, Kolawole
  10. Land Constraints in Kenya’s Densely Populated Rural Areas: Implications for Food Policy and Institutional Reform By Jayne, Thomas S.; Muyanga, Milu
  11. Determinants of Food Security in Kenya, a Gender Perspective By Kassie, Menale; Ndiritu, Simon Wagura; Shiferaw, Bekele A.
  12. Managing Environmental Risk in Presence of Climate Change: The Role of Adaptation in the Nile basin of Ethiopia By Di Falco, Salvatore; Veronesi, Marcella
  13. Working Paper 152 - Dynamics of Inflation in Uganda By AfDB
  14. Trade and Geography in the Origins and Spread of Islam By Stelios Michalopoulos; Alireza Naghavi; Giovanni Prarolo
  15. Poverty in Mozambique : new evidence from recent household surveys By Alfani, Federica; Azzarri, Carlo; d'Errico, Marco; Molini, Vasco
  17. Transaction costs, information technologies, and the choice of marketplace amongst farmers in northern Ghana By Zanello, Giacomo; Shankar, Bhavani; Srinivasan, Chittur S.
  18. Working Paper 150 - South Africa’s Quest for Inclusive Development By Ncube, Mthuli; Abebe, Shimeles; Chouchane, Audrey
  19. Optimization of Location Services in the city of Huambo. Confirmation of the Theory of Central Places By Tomaz Dentinho; Vasco Silva
  20. Weather and child health in rural Nigeria By Rabassa, Mariano; Skoufias, Emmanuel; Jacoby, Hanan G.
  24. Fear of the Dark? – How Access to Electric Lighting Affects Security Attitudes and Nighttime Activities in Rural Senegal By Gunther Bensch; Jörg Peters; Maximiliane Sievert

  1. By: AfDB
    Abstract: Bank Financing to Small and Medium Enterprises in East Africa: Findings of a Survey in Kenya, Tanzania, Uganda and Zambia
    Date: 2012–03–26
  2. By: AfDB
    Date: 2012–05–14
  3. By: AfDB
    Date: 2012–09–10
  4. By: AfDB
    Date: 2012–05–14
  5. By: AfDB
    Date: 2012–04–03
  6. By: Asma Hyder (Karachi School for Business and Leadership, Pakistan); Jere R. Behrman (Population Studies Center, Sociology Department, University of Pennsylvania); Hans-Peter Kohler (Population Studies Center, Sociology Department, University of Pennsylvania)
    Abstract: This study investigates the impacts of negative economic shocks on child schooling in households of rural Malawi, one of the poorest countries in Sub-Saharan Africa (SSA). Two waves of household panel data for years 2006 and 2008 from the Malawi Longitudinal Study of Families and Health (MLSFH) are used to examine the impact of negative shocks on child schooling. Both individually-reported and community-level shocks are investigated. A priori the impact of negative shocks on schooling may be negative (if income effects dominate) or positive (if price effects dominate). Also the effects may be larger for measures of idiosyncratic shocks (if there is considerable within-community variation in experiencing shocks) or for aggregate shocks (if community support networks buffer better idiosyncratic than aggregate shocks). Finally there may be gender differences in the relevance for child schooling of shocks reported by men versus those reported by women with, for example, the former having larger effects if resource constraints have strong effects on schooling and if because of gender roles men perceive better than women shocks that affect household resources. The study finds that negative economic shocks have significant negative impacts on child school enrollment and grade attainment, with the estimated effects of the community shocks larger and more pervasive than the estimated effects of idiosyncratic shocks and with the estimated effects of shocks reported by men as large or larger than the estimated effects of shocks reported by women.
    Keywords: Africa, Economic Shocks, Child Schooling
    JEL: N37 E30 I21
    Date: 2012–09–11
  7. By: Andersson, Per-Åke (Department of Economics, School of Business, Economics and Law, Göteborg University); Sjö, Bo (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: Inflation has proven to be an important obstacle to successful economic adjustment in many countries. Despite both internal and external shocks to the economy, Mozambique has succeeded in controlling the inflation to gain high economic growth. This paper provides an econometric analysis of the dynamics behind the experience of Mozambique. Inflation is driven by both a purchasing power parity relation with South Africa and monetary factors. The result indicates that the country is using a crawling peg exchange rate regime.
    Keywords: inflation; purchasing power parity; money market; VAR model
    JEL: C32 E31 E50
    Date: 2012–10–02
  8. By: AfDB
    Date: 2012–02–16
  9. By: Amikuzuno, Joseph; Ogundari, Kolawole
    Abstract: Price transmission studies have become increasingly important in Sub Sahara Africa over the last two decades because of their application in assessing the impact of the market reforms policies embarked upon by the region’s governments between the mid 1980s and early 1990s. In this study, a meta database obtained from 45 price transmission studies published between 1978 and 2011, is used to provide an overall assessment of the potential impact of selected, study-specific attributes on estimated price transmission coefficients and in identifying asymmetric price transmission. Despite the large dispersion of estimated price transmission coefficients 2.5% - 94.2%, the mean coefficient of 32.2% is an overall assessment that the extent of price transmission in SSA is comparatively low. The predicted impacts of the study-specific attributes on the price transmission coefficients, and on the likelihood of the primary studies to report asymmetric price transmission however differ consistently across the attributes, and provide in general evidence on the critical role such attributes play in determining price transmission results and their implications for policy formulation. Therefore, future research on price transmission should carefully account for the impact of study-specific attributes in their results.
    Keywords: meta-analysis, Price transmission, asymmetry, Sub-Saharan Africa, Agribusiness,
    Date: 2012–04
  10. By: Jayne, Thomas S.; Muyanga, Milu
    Abstract: This study analyzes the impact of increasing population density in Kenya’s rural areas on smallholder behavior and welfare indicators. We first present evidence to explain how land constraints can be emerging within an overall context of apparent land under-utilization. Using data from five panel surveys on 1,146 small-scale farms over the 1997-2010 period, we use econometric techniques to determine how increasing rural population density is affecting farm household behavior and livelihoods. We find that farm productivity and incomes tend to rise with population density up to 600-650 persons per km2; beyond this threshold, rising population density is associated with sharp declines in farm productivity, total household income, and asset wealth. Currently 14% of Kenya’s rural population resides in areas exceeding this population density. The study concludes by exploring the nature of institutional and policy reforms needed to address these development problems.
    Keywords: Land, population density, smallholder agriculture, food security, policy, Kenya, Agricultural and Food Policy, Food Security and Poverty, Land Economics/Use, Q15, Q18, Q24,
    Date: 2012–04
  11. By: Kassie, Menale; Ndiritu, Simon Wagura; Shiferaw, Bekele A.
    Abstract: The paper contributes to an understanding of the determinants of food security with a bias on the link between gender of household head and food security using detailed farm household and plot level survey data from 30 divisions in rural Kenya. Both parametric and non-parametric econometric techniques are used to ensure robustness of the results from the econometric analyses. Since the assumption of pooled regression is rejected, we run separate food security regressions at plot level both for Male Headed Households (MHHs) and Female Headed Households (FHHs). Both descriptive and econometrics results shows that FHHs in general are more likely to be food insecure compared to their male counterparts. The analysis further reveals that Female Headed Households‘ food security increases with quality of extension workers; land quality, farm size while distance to the market reduces the probability of food security. For the quality of extension staff, policy makers should focus on improving the skill of extension staff for efficient and effective dissemination of technologies and other important information that has impact on food security. Since area expansion is infeasible due to land scarcity in Kenya, policy makers focusing on land augmenting practices can help farm households to escape food insecurity.
    Keywords: food security, gender, parametric and non-parametric methods, Kenya, Food Security and Poverty, O13, Q18,
    Date: 2012–04
  12. By: Di Falco, Salvatore; Veronesi, Marcella
    Abstract: This study investigates the impact of climate change adaptation on farm households’ downside risk exposure in the Nile Basin of Ethiopia. The analysis relies on a moment-based specification of the stochastic production function. We use an empirical strategy that accounts for the heterogeneity in the decision on whether to adapt or not, and for unobservable characteristics of farmers and their farm. We find that (i) past adaptation to climate change adaptation reduces current downside risk exposure, and so the risk of crop failure; (ii) climate change adaptation would have been more beneficial to the nonadapters if they adapted, in terms of reduction in downside risk exposure; and (iii) climate change adaptation is a successful risk management strategy that makes the adapters’ more resilient to climatic conditions.
    Keywords: adaptation, climate change, downside risk exposure, environmental risk, Ethiopia, Environmental Economics and Policy, D80, Q18, Q54,
    Date: 2012–04
  13. By: AfDB
    Date: 2012–09–10
  14. By: Stelios Michalopoulos; Alireza Naghavi; Giovanni Prarolo
    Abstract: This research examines the economic origins and spread of Islam in the Old World and uncovers two empirical regularities. First, Muslim countries and ethnic groups exhibit highly unequal regional agricultural endowments. Second, Muslim adherence is systematically higher along the pre-Islamic trade routes. We discuss the possible mechanisms that may give rise to the observed pattern and provide a simple theoretical argument that highlights the interplay between an unequal geography and proximity to lucrative trade routes. We argue that these elements exacerbated inequalities across diverse tribal societies producing a conflictual environment that had the potential to disrupt trade flows. Any credible movement attempting to centralize these heterogeneous populations had to offer moral and economic rules addressing the underlying economic inequalities. Islam was such a movement. In line with this conjecture, we utilize anthropological information on precolonial traits of African ethnicities and show that Muslim groups have distinct economic, political, and societal arrangements featuring a subsistence pattern skewed towards animal husbandry, more equitable inheritance rules, and more politically centralized societies with a strong belief in a moralizing God.
    Keywords: Religion, Islam, Geography, Redistribution, Land Inequality, Africa, Wealth Inequality, Trade.
    Date: 2012
  15. By: Alfani, Federica; Azzarri, Carlo; d'Errico, Marco; Molini, Vasco
    Abstract: This paper has three primary objectives: (i) to investigate potential problems regarding Mozambique's most recent nationally representative household survey on poverty dynamics; (ii) to assess the robustness and reliability of official poverty statistics; and (iii) to provide alternative estimates of poverty and welfare indicators in light of the methodological and analytical issues raised in areas (i) and (ii). It is determined that at least two significant weaknesses affect the official poverty-rate estimates: measurement errors in consumption data and flaws in the methodology used to calculate poverty lines (the cost-of-basic-needs approach based on provincial food bundles with entropy correction). A number of observations appear to be affected by substantial measurement errors, which severely distort the official poverty statistics. The paper provides methods to correct the consumption distribution by recalculating poverty lines based on a single national food basket -- as opposed to the current estimates, which are based on province-specific food baskets. The revised poverty statistics differ considerably from the official estimates of poverty across provinces and are far more consistent with other poverty indicators. In addition, poverty appears to be highly concentrated in certain areas, with dramatically higher rates found in Central and Northern Mozambique, as well as in rural areas overall, compared with relatively low rates in Southern Mozambique and in the country's urban centers. These findings substantially contradict the government's official poverty figures, which appear to systematically overestimate poverty rates in Mozambique's Southern provinces and urban areas while simultaneously underestimating the prevalence of poverty in the country's Central and Northern regions and in rural areas nationwide.
    Keywords: Rural Poverty Reduction,Regional Economic Development,Poverty Lines,Food&Beverage Industry
    Date: 2012–10–01
  16. By: Akande, Olaide Rufai
    Abstract: Motivated by the negative impact of the 2006-2008 food crises on rice consumer prices and welfare, the impact of international trade on producer prices of rice in food deficit countries was examined using data collected from five randomly selected West African countries and analyzed with econometric GARCH estimation procedure. The finding shows that domestic rice producers in food deficit countries benefit from international prices in countries where market liberalization is not significantly associated with instability in domestic producer prices. Further evidence leads to the conclusion that: urbanization results into preference for imported rice and low producer prices in some areas; market information system, market access infrastructure and integration of domestic markets with regional and global types are poorly developed; official development assistance (ODA) is an important policy tool for development of rice sector in these areas; and that policy efforts in these countries at controlling producer price volatility during the 2006-2008 food crises were largely effective. The study suggests that in order to ensure a competitive domestic rice market, curb producer price volatility and benefit from international trade, a concomitant heavy public investment in agriculture, development of market access infrastructure, market information system as well as market integration are necessary policy actions in these countries.
    Keywords: Producer prices, market liberalization, price transmission, producer price volatility, International Relations/Trade,
    Date: 2012–04
  17. By: Zanello, Giacomo; Shankar, Bhavani; Srinivasan, Chittur S.
    Abstract: Relatively little evidence is available on the importance of information and the role of Information Communication Technologies (mobiles and radios) in the key aspects of marketing behaviours of developing country farmers. We included the concept of proportional and fixed transactions costs within a household framework to investigate market participation decisions of farm households with a marketable surplus of food crops. Differently to previous studies, we also modelled the behaviour of farm gale buyers. We use a novel dataset from Ghanaian farmers, which contains detailed information fro individual selling transaction that is seldom available in other household surveys. We found that larger transactions occur at the farmgale, where farmgale buyers are prepared to pay a premium price because of lower fixed transaction costs they incur. The knowledge of market information has a contrasting effect on the decision of the marketplace. In some cases, farmers use the information on prices in specific marketplaces to travel farther, in other cases they sell their commodity in closer market where they may strenghening their bargaining power. Finally we only found weak evidence on the impact of using mobile phones in reducing searching costs and attract farm gate buyers.
    Keywords: market behaviour, transaction costs, information technologies, Research and Development/Tech Change/Emerging Technologies, D82, D83, D84, O12, 055,
    Date: 2012–04
  18. By: Ncube, Mthuli; Abebe, Shimeles (African Development Bank); Chouchane, Audrey
    Date: 2012–05–28
  19. By: Tomaz Dentinho; Vasco Silva
    Abstract: The optimization of the location of public services in the villages and neighborhoods in the city of Huambo in Angola results in a hierarchical system of central places that can be calibrated to give different hierarchies according to the accessibility level. This result is achieved for 300 villages and neighborhoods in the city of Huambo by minimizing the number of centers subject to the restriction that the service is available at a minimum distance. Other solutions are found that maximize the net benefit distribution centers. At the end multicriteria is used to study the resilience of the centers to alternative weights of the criteria and different accessibility ranges. The solutions are used to design roads, local authorities and market shares. Keywords: location, central places, agglomeration economies, Africa JEL: R12 - Size and Spatial Distributions of Regional Economic Activity; R58 - Regional Development Planning and Policy
    Date: 2012–10
  20. By: Rabassa, Mariano; Skoufias, Emmanuel; Jacoby, Hanan G.
    Abstract: The effect of weather shocks on children's anthropometrics is investigated using the two most recent rounds of the Nigeria Demographic and Health Survey. For this purpose, climate data for each survey cluster are interpolated using daily weather-station records from the national network. The findings reveal that rainfall shocks have a statistically significant and robust impact on child health in the short run for both weight-for-height and height-for-age, and the incidence of diarrhea. The impacts of weather shocks on health are of considerable magnitude; however, children seem to catch up with their cohort rapidly after experiencing a shock. The paper does not find any evidence of nonlinear impacts of weather variability on children's health, suggesting that a moderate increase in future rainfall variability is not likely to bring additional health costs. Finally, it appears that the impact of these shocks is the same for young boys and girls, which suggests that there is no gender-based discrimination in the allocation of resources within households.
    Keywords: Health Monitoring&Evaluation,Science of Climate Change,Environmental Economics&Policies,Disease Control&Prevention,Climate Change Mitigation and Green House Gases
    Date: 2012–10–01
  21. By: Sassi, Maria; Cardaci, Alberto
    Abstract: The paper aims at analysing the impact of the likely change in rainfall on food availability and access to food in Sudan. The empirical investigation is based on an integrated approach consisting on a stochastic method and CGE model. The former provides the likely changes in sorghum, millet and wheat productivity and their probability of occurrence according to rainfall predictions based on historical data. These results are at the basis of the shocks simulated in a standard CGE model augmented with a stochastic component. Achievements underline the negative impact on the two dimensions of food security taken into consideration, mainly due to a reduction in cereal supply, a marked cereal inflation pressure and income contraction; the grater negative effect on the poorest households; and a deterioration of the economic performance of the country. In this context, the paper stresses a strong interconnection among climate change, poverty and food insecurity and thus the need for an integrated policy-making approach.
    Keywords: Climate change, Food Security, Stochastic approach, CGE, Sudan, Food Security and Poverty, C68, Q18, Q54,
    Date: 2012–04
  22. By: Moumouni, Ismail; Baco, Mohamed N.; Tovignan, Silvere D.; Djohy, Georges
    Keywords: Community/Rural/Urban Development, Research and Development/Tech Change/Emerging Technologies, Teaching/Communication/Extension/Profession,
    Date: 2012
  23. By: Moumouni, Ismail; Tovignan, Silvere D.; Baco, Mohamed N.; Nouatin, Guy
    Abstract: Understanding how local stakeholders participate in designing and implementing development projects is important to improve their effectiveness. This study used three case studies of privatisation reform of agricultural research and extension in Benin, to analyse recent trends in the participation of farmers, public and private organisations in implementing and designing reforms. Thematic and comparative analyses were performed on qualitative data collected during direct observation and semi-structured interviews with different stakeholders. The finding indicated that although participation was generally considered as requirement for developing high quality services, its importance in designing appropriate service delivery and funding reforms was underestimated or ignored.
    Keywords: Agricultural research and extension, Benin, Development project, Privatisation, Community/Rural/Urban Development, Teaching/Communication/Extension/Profession,
    Date: 2012
  24. By: Gunther Bensch; Jörg Peters; Maximiliane Sievert
    Abstract: Providing access to electricity is widely considered as a precondition for socio-economic development in rural areas of developing countries. While electrification interventions are often expected to reduce poverty through productive uses for income generating purposes, the reality in rural usage patterns looks different: Electricity is often used for lighting and entertainment devices only. It is particularly lighting with its implications for security and convenience that explains the high importance beneficiaries assign to electrification. Against this background, this paper probes into the effects of Solar Home System electricity usage on lighting consumption and activities after nightfall using cross-sectional household-level data from rural Senegal. We apply a new matching algorithm to control for a possible self-selection into Solar Home System ownership and find substantially higher lighting usage and study time after nightfall of school children. We also find some indication for improvements in perceived security.
    Keywords: Rural electrification; energy access; impact evaluation; matching
    JEL: O12 O13 O18 O22
    Date: 2012–09

This nep-afr issue is ©2012 by Quentin Wodon. 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.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.