nep-afr New Economics Papers
on Africa
Issue of 2013‒08‒05
sixteen papers chosen by
Quentin Wodon
World Bank

  1. Impact of Improved Maize Adoption on Welfare of Farm Households in Malawi: A Panel Data Analysis By Bezu, Sosina; Kassie, Girma; Shiferaw, Bekele; Ricker-Gilbert, Jacob
  2. The Black Man's Burden - The Cost of Colonization of French West Africa By Elise Huillery
  3. Political Structure as a Legacy of Indirect Colonial Rule: Bargaining between National Governments and Rural Elites in Africa By Mizuno, Nobuhiro
  4. Low---intensity Conflict and Firm Level Investment in Ethiopia By Admasu Shiferaw; Dominik Noe
  5. Causality between Exports and Economic Growth in South Africa: Evidence from Linear and Nonlinear Tests By Ahdi N. Ajmi; Goodness C. Aye; Mehmet Balcilar; Rangan Gupta
  6. Association between obesity and selected morbidities: A study of BRICS By Ankita, Ankita Shukla; Kaushal, Kaushalendra Kumar; Abhishek, Abhishek Singh
  7. The Influence of Social Capital Dimensions on Household Participation in Micro-Credit Groups and Loan Repayment Performance in Uasin Gishu County, Kenya By Kangogo, Daniel; Lagat, Job; Ithinji, Gicuru
  8. Core economic issues in the horticulture sector of Botswana By Moepeng, Pelotshweu
  9. Technology Adoption and Dissemination in Agriculture: Evidence from Sequential Intervention in Maize Production in Uganda By Tomoya Matsumoto; Takashi Yamano; Dick Sserunkuuma
  10. BRICS:The rise of sleeping giant By Pavnesh Kumar
  11. Is Organic Farming Worth its Investment? The Adoption and Impact of Certified Pineapple Farming in Ghana By Linda Kleemann; Awudu Abdulai; Mareike Buss
  12. Corporate social responsibility in zones of conflict By Rieper, Sarah
  13. Rabbit breed characteristics, farmer objectives and preferences in Kenya: A correspondence analysis By Mailu, Stephen; Wanyoike, M; Serem, Jared
  14. Daily Needs, Income Targets and Labor Supply: Evidence from Kenya By Pascaline Dupas; Jonathan Robinson
  15. Rural development in Botswana: Experience from elsewhere and emerging issues By Moepeng, Pelotshweu
  16. School Resources, Behavioral Responses and School Quality: Short-Term Experimental Evidence from Niger By Elise Huillery; Elizabeth Beasley

  1. By: Bezu, Sosina; Kassie, Girma; Shiferaw, Bekele; Ricker-Gilbert, Jacob
    Abstract: This paper assesses improved maize adoption in Malawi and examines the link between adoption and household welfare using a three-year household panel data. The distributional effect of maize technology adoption is also investigated by looking at impacts across wealth and gender groups. We applied control function approach and IV regression to control for endogeneity of input subsidy and improved maize adoption. We found that modern maize variety adoption is positively correlated with the household’s own maize consumption, income and asset holdings. We found evidence that improved maize adoption has stronger impact on welfare of female-headed households and poorer households.
    Keywords: Improved maize, hybrid maize, technology adoption, subsidy, Malawi, Africa
    JEL: I39 O1 O12 O33 Q16 Q18
    Date: 2013–07–31
  2. By: Elise Huillery (Département d'économie)
    Abstract: Was colonization costly for France? Did French taxpayers contribute to colonies' development? This paper reveals that French West Africa's colonization took only 0.29 percent of French annual expenditures, including 0.24 percent for military and central administration and 0.05 percent for French West Africa's development. For West Africans, the contribution from French taxpayers was almost negligible: mainland France provided about two percent of French West Africa's revenue. In fact, colonization was a considerable burden for African taxpayers since French civil servants' salaries absorbed a disproportionate share of local expenditures.
    Date: 2013
  3. By: Mizuno, Nobuhiro
    Abstract: Alliances between national governments and rural elites are observed in post-colonial Africa. In such alliances, the national governments preserve rural-elite authority formed during the colonial era and cede their resources and prerogatives to the rural elites. This paper develops a model of bargaining between a national government and a rural elite, in which the bargaining power of the national government is endogenously explained by the ability of the rural elite to compel obedience from rural residents. Since indirect colonial rule is a significant source of the rural-elite control over residents, the result implies that cross-regional variations in colonial policies lead to variations in the feature of post-colonial alliances between African national governments and rural elites.
    Keywords: Africa; Colonialism; Politics
    JEL: H11 H20 N47 P16 Q13
    Date: 2013–08–01
  4. By: Admasu Shiferaw (Department of Economics, The College of William and Mary); Dominik Noe (Courant Research Centre-PEG, University of Goettingen)
    Abstract: This paper investigates firm level responses to a large scale public investment program on road infrastructure in Ethiopia during 1997 to 2010. Firms' location choices and average start-up size are examined by combining town level panel data on road accessibility with a panel of manufacturing firms for the period 1996 to 2009. We find econometric results showing that better road access increases a town's attractiveness for manufacturing firms. While towns with initially large number of firms continue to attract more firms, there has been a tendency toward convergence in the distribution of firms, reducing their geographic concentration. Average startup size in isolated locations is also smaller relative to firms entering well connected markets in terms of road access. We conclude that improved road infrastructure has a favorable impact on the entry patterns and structure of the manufacturing sector in Ethiopia.
    Keywords: Armed conflict, investment, firms, Ethiopia, GIS data
    JEL: D22 O12
    Date: 2013–07–25
  5. By: Ahdi N. Ajmi (College of Science and Humanities in Slayel, Salman bin Abdulaziz University, Kingdom of Saudi Arabia); Goodness C. Aye (Department of Economics, University of Pretoria); Mehmet Balcilar (Department of Economics, Eastern Mediterranean University, Famagusta, North Cyprus,via Mersin 10, Turkey); Rangan Gupta (Department of Economics, University of Pretoria)
    Abstract: This paper investigates the dynamic causal link between exports and economic growth using both linear and nonlinear Granger causality tests. We use annual South African data on real exports and real gross domestic product from 1911-2011. The linear Granger causality result shows no evidence of significant causality between exports and GDP. The relevant VAR is unstable, which undermines our confidence in the causality result identified by linear Granger causality tests. Accordingly we turn to the nonlinear methods to evaluate Granger causality between exports and GDP. We use both Hiemstra and Jones (1994) and Diks and Panchenko (2005) nonlinear Granger causality tests. For the Hiemstra and Jones (1994) test, we find a unidirectional causality from GDP to exports. However, using the Diks and Panchenko (2005) test, we find evidence of significant bi-directional causality. These results highlight the risk of misleading conclusions based on the standard linear Granger causality tests which neither accounts for structural breaks nor uncover nonlinearities in the dynamic relationship between exports and GDP.
    Keywords: Exports, economic growth, causality, linear, nonlinear
    JEL: C14 C32 F43 O40
    Date: 2013–08
  6. By: Ankita, Ankita Shukla; Kaushal, Kaushalendra Kumar; Abhishek, Abhishek Singh
    Abstract: Context: Over the past few decades, obesity has reached epidemic proportions, and is a major contributor to the global burden of chronic diseases and disability. There is little evidence on obesity related co-morbidities in BRICS countries. Objectives: The first objective is to examine the factors associated with overweight and obesity in four of the five BRICS countries (China, India, Russia and South Africa). The second is to examine the linkage of obesity with selected morbidities. Methods: We used data from the Study on Global Ageing and Adult Health (SAGE) survey conducted in China, India, Russia and South Africa during 2007-10. Respondents with a body mass index (BMI)>= 25 but <30 were coded as overweight, and those with BMI>= 30 as obese. Bivariate analysis, binary logistic regression and multinomial logistic regression are used in the analysis. The morbidities included in the analysis are Hypertension, Diabetes, Angina, Stroke, Arthritis and Depression. Results: The prevalence of obesity was highest in South Africa (35%) followed by Russia (27%), China (5%) and India (3%). The prevalence of obesity was significantly higher in females as compared to males in all the countries. While the wealth quintile was significantly associated with obesity in India, Russia and South Africa, engaging in work requiring physical activity was significantly associated with obesity in China and South Africa. Overweight/obesity was significantly associated with morbidities such as Hypertension, Angina, Diabetes and Arthritis in all the four countries. In comparison, overweight/obesity was not associated with Stroke and Depression in any of the four countries included in the analysis. Conclusion: The data demonstrates a high prevalence of obesity in South Africa and Russia. Overweight/obesity was significantly associated with Hypertension, Angina, Diabetes and Arthritis.
    Keywords: overweight, obesity, hypertension, diabetes, angina, stroke, arthritis, depression, BRICS
    JEL: I1 I12
    Date: 2013–07–19
  7. By: Kangogo, Daniel; Lagat, Job; Ithinji, Gicuru
    Abstract: Lack of access to credit is a key obstacle for economic development of transitional economies such as Kenya. The underlying problem is related to information asymmetry combined with the lack of collateral by low income households. Microfinance led group lending model offer a new way to deal with this problem without resorting to collateral requirements. The core issue in group lending is that it systematically exploits elements of social capital that inherently exist in groups into an incentive contract that substitutes collateral; a formal bank conventional requirement of lending that is virtually unavailable to the poor. This study sought to ascertain the influence of social capital dimensions on households’ participation and repayment performance in micro-credit groups in the study area. The study was conducted in Moiben Division, Uasin Gishu County, Kenya based on a sample of 174 households selected using a multi-stage sampling technique. The data was collected using a personally administered structured questionnaire. In the analysis descriptive statistics, Heckman two stage and a Tobit regression models were employed. The results show that individual and group borrowers had significant differences in gender, age, farm size, years of education, income and land tenure. It was established that household size, farm income and distance to the nearest financial institution positively influenced a household to join micro-credit group. On the other hand age, gender, years of education, farm size and interest rate were found to be significant and negatively influenced household decision to join micro-credit groups. The level of household participation in micro-credit groups measured by the number of loan borrowings was significantly and positively influenced by age, total income, years of experience in group borrowing and decision making index while farm size, heterogeneity index and density of membership had a negative affect on household number of loan borrowings. Lastly, the results on group loan repayment performance using the Tobit model revealed that experience in group borrowing, number of visits by loan officer, peer pressure, meeting attendance index and heterogeneity index positively and significantly influenced loan default rate while gender, household size, distance to the nearest financial institution and density of membership were significant but negatively influenced household loan repayment performance. The study therefore recommends that MFIs should increase awareness and encourage poor households to form micro-credit groups. These institutions are obliged to provide training to households on group dynamics in order to take advantage of social capital existing within well organized and managed groups.
    Keywords: Social capital, Access to Credit, Group Lending, Microfiance, Heckman two step Model, Tobit Model, Loan Repayment, Micro-credit Group
    JEL: D7 D71 G2 G23
    Date: 2013–04–25
  8. By: Moepeng, Pelotshweu
    Abstract: Poverty and unemployment in Botswana are the major problems that the government is focusing its effort and attention on. The overall government aim is to eradicate poverty and diversify the economy away from diamond mining to create sustainable jobs. Agriculture is traditionally thought to be a primary sector that can help the country’s disadvantaged community to escape from poverty and problems of unemployment. However, Botswana has experienced falling agricultural productivity and a fall in its GDP share from 40 per cent in 1966 at independence from Britain to 2.1 per cent 2001. This article demonstrates that although overall performance in the agricultural sector of Botswana has been falling and remains generally very low, in the sub-sector of horticultural production, production has doubled in the last decade and productivity has improved. This has led to improved achievement towards food self sufficiency at the national level in terms of availability of food from the nation’s producers. However, this article argues that such improved productivity in horticulture only benefits a few rich companies and individuals who have the capacity to invest in the very high capital investment required in this sector and in the necessary transport (including refrigerated transport) that is needed to move horticultural goods from one place to the other. One of the major issues raised in this study is that the agricultural policy excludes the horticultural sector from its major priorities. Hence, most activities in the sector are influenced by geographical location and transport or logistics concerns, the market structure, and well intended government interventions that are sometimes used to crowd out the small-scale farmers and stakeholders. Government is also encouraged to re-look at the opportunities for marketing horticulture and take an active lead to create structures that can promote creation of sustainable jobs and participation of small-scale producers in this sector.
    Keywords: Botswana, Botswana’s horticulture market, employment creation, food self-sufficiency, horticulture, poverty alleviation., Community/Rural/Urban Development, Crop Production/Industries, Q13, Q18, O13,
    Date: 2013–05
  9. By: Tomoya Matsumoto (National Graduate Institute for Policy Studies); Takashi Yamano (National Graduate Institute for Policy Studies); Dick Sserunkuuma (Makerere University)
    Abstract: We use a randomized control trial to measure how the free distribution of modern inputs for maize production affects their adoption in the subsequent season. Information collected through sales meetings where modern inputs were sold revealed that the average purchase quantity of free-input recipients was much higher than that of non-recipients; that of the neighbors of recipients fell in-between. Also, credit sales had a large impact on purchase quantity, and the yield performance of plots where the free inputs had been applied positively affected the purchase quantities of both recipients and the neighbors with whom they shared information on farming.
    Date: 2013–07
  10. By: Pavnesh Kumar
    Abstract: The combined territories of the BRICS countries account for nearly 30 percent of the world's total land area and 42 percent of the world's total population . In 2010, the group contributed 18 percent of the world's GDP and 15 percent of world trade. Among the BRICS members, China has been the "world factory" for many years, Brazil is a globally important "raw material base," Russia is an important world "petrol station," India is the world's well-known "office," while South Africa is "Africa's resources reservoir."This paper intents to highlights the growing influence of BRICS in the world economy and its role in the changing world economic order.It also intends to discuss the future ,issues and challenges ahead for BRICS and the standing of India in this group. Key words: economic growth, Emerging markets, structural change, BRIC countries
    Date: 2013–06
  11. By: Linda Kleemann; Awudu Abdulai; Mareike Buss
    Abstract: Global food markets demand the adoption of food standards by small-scale farmers in developing countries when they enter international markets. While a conventional certification with GlobalGAP can be a market entry condition for conventional food, especially for horticultural products, organic certification is required for the growing organic food market that is usually associated with higher prices. This study analyzes the adoption and profitability of organic certified farming, using recently collected farm-level data of 386 Ghanaian pineapple farmers. We employ an endogenous switching regression model to examine the adoption and impact of organic certification on the return on investment (ROI). The empirical results indicate that both organic certification and GlobalGAP certification result in a positive ROI. However, organic certified farming yields a significantly higher ROI than GlobalGAP certified farmers, mainly due to the price premium on the organic market. Thus, certified organic farming is found to be the more profitable venture
    Keywords: return on investment, impact assessment, organic agriculture, GlobalGAP certification, contract farming
    JEL: O13 Q13 Q17 Q56
    Date: 2013–07
  12. By: Rieper, Sarah
    Abstract: Departing from the previous focus on negative involvements of business in the political economy of war and its role in fuelling or causing conflict, transnational corporations are increasingly expected to contribute to conflict prevention, crisis management and post-conflict peace building. This paper analyzes under which conditions transnational corporations contribute to peace and security in zones of conflict. The question is explored in the framework of a comparative case study of Shell' engagement in Nigeria and BP's engagement in Azerbaijan. It is argued that transnational civil society activism, company and production characteristics and the role of the host state are crucial determinants of corporate engagement towards peace and security. --
    Date: 2013
  13. By: Mailu, Stephen; Wanyoike, M; Serem, Jared
    Abstract: Rabbit production is becoming important in Kenya not by young boys but as an economic undertaking. This may be due to decreasing per capita landholdings due to increasing human population density. However, there is little published information on requirements for successful rabbit production. A study was designed done to characterize the rabbit production systems to allow identification of constraints and opportunities along this particular value chain. Respondents in a survey were purposively selected from four regions of the country where there is significant rabbit farming activity according to the Ministry of Livestock Development. These included Rift Valley, Central, Eastern and Coastal region. Structured questions were asked, several rabbit breeds and their crosses were identified and the study sought to couple farmer stated objectives with these breeds. The coupling of breeds to the stated farmer assessment of their traits and benefits was also attempted. This was implemented through the application of correspondence analysis on these frequency data. Results indicated that there was considerable rhyme between farmer stated objectives and the rabbit breeds while this correspondence also stretched to breed and the farmers' stated qualities of the breeds. These results therefore showed that stated inherent qualities of the breed also might direct farmer choices. Whereas slightly over half (52.3%) of the farmers kept rabbits with a commercial intention, the findings from the analysis indicate that some heavy breeds such as French Ear Lop and the Flemish Giant score highly for their carcass weight. That these breeds have a poor bone-meat ratio unlike the more popular New Zealand White and Californian White indicate that farmers do not consider the true value of the product such as bone:meat ratios. In a commercial enterprise, these results are perplexing and serve to show that farmers may require more capacity to appreciate the inherent breed characteristics rather than just the overtly recognizable breed characters.
    Keywords: Correspondence analysis, farmer preference, rabbit characteristics
    JEL: C10 Q12
    Date: 2013–07–20
  14. By: Pascaline Dupas; Jonathan Robinson
    Abstract: Many studies suggest that daily income earners behave as if they have daily income targets. Less work has examined the determinants of the targets themselves. Using data on labor supply, shocks, and self-reported cash needs from 257 bicycle taxi drivers in Western Kenya, we provide evidence that many individuals treat their daily cash need as the day's target. We conjecture that in a physically demanding job, workers may have an incentive to quit early and so set a personal rule of “earning enough for the day's need” as an internal commitment device to provide effort. This heuristic is more common among less educated workers and has substantial welfare costs: greater variance in hours worked is associated with worse health, and we estimate that workers would earn 5% more by working a set number of hours each day (more if their wage elasticity were positive).
    JEL: C93 D12 J22
    Date: 2013–07
  15. By: Moepeng, Pelotshweu
    Abstract: Poverty incidence is one of the most critical concerns in Botswana and the government has resolved to eradicate this problem and ensure that every citizen live in a dignified and acceptable condition consistent with the national aspirations as set out in the National Vision 2016. Currently, rural areas are persistently experiencing the highest poverty incidence compared to any other place in the country. This has been the case ever since we have measured the extent of the poverty problem in 1985/86. Rural development in Botswana has been a central policy and strategy of government effort to improve the welfare and standard of living since independence. Since the 1970s, a rural development council that was traditionally chaired by a Vice President demonstrates the importance that government takes about rural development. The membership of this council involves all permanent secretaries and key non-government stakeholders. The Council has made tremendous success in transforming Botswana from a primarily rural based population to a country where the majority of its residents live in urban areas. Initial rural development efforts that provided basic infrastructure countrywide contributed to Botswana’s urbanization as part of this process involved a reclassification of many former rural villages into urban villages, particularly after the 1991 Population Census. Rural population is now a minority but the problems of poverty and vulnerability remains higher than in other areas. The nature and outlook of rural areas have changed dramatically and so have the needs of the rural people. There is a need to review our definition of a rural area, and re-visit the policies and processes of facilitating rural development to make them more relevant to emerging issues and challenges. This papers proposes that the country should choose its programmes and projects for development based on their ability and past record to perform, target government support more efficiently and effectively, acknowledge emerging challenges and respond accordingly by improving the operations of a market system, even if it requires government intervention.
    Keywords: agriculture, credit, cooperatives, globalization, indigenous knowledge land markets, poverty, property rights, rural development, sustainable employment, wildlife tourism, Agricultural and Food Policy, Community/Rural/Urban Development, Labor and Human Capital, O13, O15, 018,
    Date: 2013–06
  16. By: Elise Huillery (Département d'économie); Elizabeth Beasley
    Abstract: Increasing school resources has often shown disappointing effects on school quality in developing countries, a lack of impact which may be due to student, parent or teacher behavioral responses. We test the short-term impact of an increase in school resources under parental control using an experimental school grant program in Niger.
    JEL: H52 O15 I21 I28
    Date: 2013–04

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