nep-afr New Economics Papers
on Africa
Issue of 2014‒07‒21
fifteen papers chosen by
Christian Zimmermann
Federal Reserve Bank of St. Louis

  1. Demystifying the Role of Grain Assemblers in the Rural Maize Markets of Eastern and Southern Africa By Sitko, Nicholas; Jayne, T.S.
  2. The Democratic Window of Opportunity: Evidence from Riots in sub-Saharan Africa By Toke S. Aidt; Gabriel Leon
  3. The Political Economy of Bad Data: Evidence from African Survey & Administrative Studies- Working Paper 373 By Justin Sandefur and Amanda Glassman
  4. The ambiguous role of remittances in West African countries facing climate variability By Cécile Couharde; Rémi Generoso
  5. Global Finance Brief: Monetary Policy Shocks from the EU and US: Implications for Sub-Sharan Africa By Jeremy Kronick
  6. Networks and Manufacturing Firms in Africa: Results from a Randomized Field Experiment By Marcel Fafchamps; Simon Quinn
  7. Four Instruments to Strengthen Financial Integration in Sub-Saharan Africa By Amadou SY
  8. From Rebellion to Electoral Violence. Evidence from Burundi By Andrea Colombo; Olivia D'Aoust; Olivier Sterck
  9. A dynamic mapping of the political settlement in Ghana By Franklin Oduro; Mohammed Awal; Maxwell Agyei Ashon
  10. Building state capacity for inclusive development. The politics of public sector reform. By Badru Bukenya; Pablo Yanguas
  11. Consumers’ Preferences for “Bicycle Poultry” in Benin: Implications for the Design of Breeding Schemes By Epiphane Sodjinou; Arne Henningsen; Delphin O. Koudande; Gauthier Biaou; Guy Apollinaire Mensah
  12. Giving and promising gifts: experimental evidence on reciprocity from the field By J. Michelle Brock; Andreas Lange; Kenneth L. Leonard
  13. How should Uganda grow? By Ricardo Hausmann; Brad Cunningham; John Matovu; Rosie Osire; Kelly Wyett
  14. Food Crop Marketing and Agricultural Productivity in a High Price Environment: Evidence and Implications for Mozambique By Benfica, Rui; Boughton, Duncan; Mouzinho, Bordalo; Uaiene, Rafael
  15. Can aid bureaucracies think politically? The administrative challenges of political economy analysis in DFID and the World Bank By Pablo Yanguas; David Hulme

  1. By: Sitko, Nicholas; Jayne, T.S.
    Abstract: Two decades after initiating sweeping market reforms in their agricultural sectors, governments across Sub-Saharan Africa continue to maintain an active role in staple food markets. At the heart of this highly interventionist approach to food market development is a persistent and widespread distrust of private sector actors’ participation in food markets. Of all the private sector actors involved in African cereal markets, none has been more maligned or misunderstood than the private traders who assemble grain at the village-level or assembly traders as we refer to them in this paper.
    Keywords: Agricultural and Food Policy, Food Security and Poverty,
    Date: 2014–06
  2. By: Toke S. Aidt; Gabriel Leon
    Abstract: We show that drought-induced changes in the intensity of riots lead to moves towards democracy in sub-Saharan Africa, and that these changes are often a result of concessions made as a result of the riots. This provides evidence that low-intensity conflict can have a substantial short-run impact on democratic change, and supports the window of opportunity hypothesis: droughts lead to an increase in the threat of conflict, and incumbents often respond by making democratic concessions.
    Keywords: Riots, drought, transitions, democracy, autocracy.
    JEL: D7 P16
    Date: 2014–06–26
  3. By: Justin Sandefur and Amanda Glassman
    Abstract: Across multiple African countries, discrepancies between administrative data and independent household surveys suggest official statistics systematically exaggerate development progress. We provide evidence for two distinct explanations of these discrepancies. First, governments misreport to foreign donors, as in the case of a results-based aid program rewarding reported vaccination rates. Second, national governments are themselves misled by frontline service providers, as in the case of primary education, where official enrollment numbers diverged from survey estimates after funding shifted from user fees to per pupil government grants. Both syndromes highlight the need for incentive compatibility between data systems and funding rules.
    Keywords: Africa, national statistics systems, household surveys, administrative data, immunization, school enrollment, EMIS, HMIS
    JEL: C83 E31 I15 I25 I32
    Date: 2014–07
  4. By: Cécile Couharde; Rémi Generoso
    Abstract: We investigate the consequences of remittances inflows on macroeconomic performance of West African countries over the 1985 - 2007 period. We take into account the exposition of those countries to climate variability by estimating a PCHVAR model which allows heterogeneity between countries’ responses to rainfall shocks. Our results show that the impact of remittances on macroeconomic performances is highly sensitive to those shocks. In particular, when drought conditions prevail, remittances do not longer exert any short-term spillover effects on growth and may increase a situation of economic dependence, by spurring agricultural imports.
    Keywords: Climate variability; Remittances; PCHVAR model; West Africa.
    JEL: C33 F24 O11
    Date: 2014
  5. By: Jeremy Kronick (International Business School, Brandeis University)
    Abstract: Monetary policy transmission from the developed to the developing world.
    Keywords: monetary policy, development, real economic growth
    JEL: O23
    Date: 2014
  6. By: Marcel Fafchamps; Simon Quinn
    Abstract: We run a novel field experiment to link managers of African manufacturing firms. The experiment features exogenous link formation, exogenous seeding of information and exogenous assignment to treatment and placebo. We study the impact of the experiment on firm business practices outside of the lab. We find that the experiment successfully created new variation in social networks. We find some limited evidence of diffusion of management practices, particularly in terms of firm formalisation and innovation. Such diffusion appears to be a combination of diffusion of innovation and simple imitation
    JEL: D22 L26 O33
    Date: 2014
  7. By: Amadou SY (FERDI)
    Abstract: This paper proposes four tools to strengthen financial integration in sub-Saharan Africa. The first tool, “political commitment devices” can ensure steady progress on the road to an economic community. For instance, stronger regional institutions can monitor progress towards integration and encourage policymakers to respect their regional commitments. Second, the economic benefits from financial integration are better secured when countries achieve a number of “threshold conditions,” including minimum levels of financial development and governance. Third, full financial integration requires the “trinity” of equality of access, rules, and treatment. Policymakers have to eliminate entry barriers, and once foreign institutions enter domestic markets, refrain from discriminating against them. In addition, policymakers must harmonize regulations further and build capacity, especially in banking supervision. Fourth, improving the “plumbing” of financial integration—financial infrastructure—by reducing transaction costs, can provide quick gains. Innovation in mobile payments can help reduce such costs, and regulators need to balance the associated benefits and risks.
    JEL: F36 G21 G28
    Date: 2014–07
  8. By: Andrea Colombo; Olivia D'Aoust; Olivier Sterck
    Abstract: We aim at understanding the triggers of electoral violence, which spoiled 80% ofelections in Africa during the last decades. We focus on Burundi, a country wherepolls were organized in 2010, only few months after the end of a long-lasting civilwar. We find that an acute polarization between ex-rebels’ groups is highly conduciveto electoral violence. In particular, we predict a five-fold increase in electoralviolence between the lowest- and highest-polarized municipality. However, neitherethnic nor political cleavages significantly determine such electoral malpractices.These results are robust to numerous specifications. We therefore argue that policiessupporting the transition of ex-rebel groups from warfare to the political arenashould be reinforced.
    Keywords: civil war; electoral violence; polarization; demobilization; burundi
    JEL: D74 O11 O17 O55
    Date: 2014–07
  9. By: Franklin Oduro; Mohammed Awal; Maxwell Agyei Ashon
    Abstract: Ghana displays a number of features of democratic institutionalization and is considered a success story of democratic transformation in Africa. This paper examines the quality of Ghana's political transformation and the nature of its institutions. It seeks to identify the driving power relations and 'ideas' which are shaping Ghana's political and economic development. Following Levy (2012), this involves first framing Ghana as a particular type of competitive clientelist political settlement. The paper also brings agency to the fore by identifying the key actors and members of the ruling coalition that reproduce the political settlement. The final section presents some hypotheses concerning the direct influence of the political settlement on development in Ghana now and in the future. It concludes that in the short- to medium-term Ghana's democratic politics and development will continue to be informed and shaped by a competitive clientelist electoral politics. In the medium- to long-term, however, with the increasingly competitive nature of elections and the continuous expansion of the public space, the character of the political settlement in Ghana will create the incentive structure for the ruling coalition to adopt sustainable policies and strategies towards inclusive development.
    Date: 2014
  10. By: Badru Bukenya; Pablo Yanguas
    Abstract: A capable state is essential for inclusive development, and throughout the developing world governments and international development agencies are seeking to build it through a multifaceted agenda of Public Sector Reform (PSR). This paper presents an analytical review of the PSR agenda, emphasizing the political contestation inherent to the development of state capacity, and argues for a more nuanced and politically-informed research agenda. We begin by examining the various definitions of state capacity that are commonly employed by researchers, and settle on bureaucratic capacity as the transversal precondition for policy implementation. State capacity so understood has two components, effectiveness and accountability, and two domains, internal and external. Their intersection generates four broad dimensions of reform: organizational rationality, administrative restraint, social embeddedness and political autonomy; and each dimension in turn is likely to exhibit a different pattern of political contestation due to the parallel incentives for patrimonialism, corruption, oligarchy, and capture. We use this analytical framework to categorise and examine the major components of the PSR agenda, assessing their rates of success or failure according to the available evidence: we find that the relative failure of the PSR agenda so far is due to its reliance on flawed assumptions about the administrative politics of state capacity. We then evaluate whether new models that try to bypass central bureaucracies are likely to encounter greater success; specifically, we review the Africa Governance Initiative, the Open Government Partnership, and the 'hybrid models' approach of the Africa Power and Politics Programme, and argue that all of them will be forced to confront the same politics of state capacity in the end. We close the paper by outlining a set of tentative guidelines for future research at ESID and elsewhere, suggesting a greater focus on the role of elites, informal institutions, the legislature as a non-state component of state capacity, the distinction between transversal and sectoral approaches, and finally the modalities and objectives of external assistance.
    Date: 2013
  11. By: Epiphane Sodjinou (Institut National des Recherches Agricoles du Bénin); Arne Henningsen (Department of Food and Resource Economics, University of Copenhagen); Delphin O. Koudande (Institut National des Recherches Agricoles du Bénin); Gauthier Biaou (Faculté des Sciences Agronomiques, Université d’Abomey-Calavi, République du Bénin); Guy Apollinaire Mensah (Institut National des Recherches Agricoles du Bénin)
    Abstract: Village poultry, also termed "bicycle poultry," is produced in scavenging farming systems and is a chewy meat with a low fat content, and constitutes an important source of meat in many African countries. This study investigates consumers’ preferences regarding the physical traits of these birds (notably chickens, ducks and guinea fowl) in the Republic of Benin. For this purpose, we applied the hedonic price method on field data collected from retailers in four urban and five rural markets. We found that meatier drake and meatier guinea fowl with white plumage are preferred by consumers who are willing to pay a premium for these types of birds. The factors which significantly influence the price of chicken are the breed of the bird, the plumage color, the meatiness and the age of the bird. Consumers are willing to pay a price premium for meatier birds of traditional breeds with white plumage color and aged between six and twelve months. Thus, efforts to improve local breeds should stress these preferred traits.
    Keywords: Village poultry, consumer preferences, willingness to pay, breeding traits, the Republic of Benin
    JEL: D12 Q13 Q11
    Date: 2014–06
  12. By: J. Michelle Brock (European Bank for Reconstruction and Development); Andreas Lange (University of Hamburg, Department of Economics); Kenneth L. Leonard (University of Maryland, Department of Agricultural and Resource Economics)
    Abstract: In this study, we consider how gift-exchange and bonus systems function in a natural field setting by measuring the effort response of participants to non-monetary gifts over time. Our field experiment tests the difference in effort response to unconditional gifts delivered immediately, promised unconditional gifts delivered later, and conditional gifts linked to reaching a specific performance target. We find important benefits from promising to give an unconditional gift later: participants respond positively to a promised gift twice by increasing effort when the gift is promised and again when it is received. A promised gift outperforms both the unconditional gift delivered immediately, which leads to a single positive response, and the conditional gift based on performance, which does not trigger any significant behavioural change after the gift is delivered. The study lends insights into the relative effectiveness of gift-exchange and bonus systems and the temporal structure of reciprocal exchange.
    Keywords: gift exchange, reciprocity, health care, field experiment, Tanzania
    JEL: C93 I1 J41 O1
    Date: 2014–01
  13. By: Ricardo Hausmann; Brad Cunningham; John Matovu; Rosie Osire; Kelly Wyett
    Abstract: Income per capita in Uganda has doubled in the last 20 years. This remarkable performance has been buoyed by significant aid flows and large external imbalances. Economic growth has been concentrated in non-tradable activities leading to growing external imbalances and a growing gap between rural and urban incomes. Future growth will depend on achieving sufficient export dynamism. In addition, growth faces a number of other challenges: low urbanisation rate, rapid rural population growth and high dependency ratios. However, both the dependency ratio and fertility rates have begun to decline recently. Rural areas are also severely overcrowded with low-productivity subsistence agriculture as a pervasive form of production. Commercial agriculture has great possibilities to increase output, but as the sector improves its access to capital, inputs and technology it will shed jobs rather than create them. These challenges combined tell us that future growth in Uganda will require a rapid rate of export growth and economic diversification. The country faces the prospect of an oil boom of uncertain size and timing. It could represent an important stepping stone to achieve external sustainability, expanded income and infrastructure and a greater internal market. However, as with all oil booms, the challenges include avoiding the Dutch disease, managing the inevitable volatility in oil incomes and avoiding inefficient specialisation in oil. Policies that set targets for the non-oil deficit could help manage some of these effects, but a conscious strategy to diversify would still be needed. The best strategy is therefore to use the additional oil revenue and accompanying investments to promote a diversification strategy that is sustainable. To determine how to encourage such a transformation, we draw on a new line of research that demonstrates how development seldom implies producing more of the same. Instead, as countries grow, they tend to move into new industries, while they also increase productivity in existing sectors. In this report, we analyse what those new industries might be for Uganda. To do so, we first look to those products which balance the desire to increase the diversification and complexity of production, while not over-stretching existing capabilities. These include mostly agricultural inputs, such as agrochemicals and food processing. In addition, Uganda should concurrently develop more complex industries, such as construction materials, that are reasonably within reach of current capabilities and will be in great demand in the context of an oil boom. Here, the fact that Uganda is landlocked and faces high import costs will provide natural protection to the expanding demand in Uganda and neighbouring countries. We conclude with a discussion of the government policies that will support Uganda in developing new tradable industries.
    Date: 2014
  14. By: Benfica, Rui; Boughton, Duncan; Mouzinho, Bordalo; Uaiene, Rafael
    Abstract: This paper assesses the relationship between agricultural productivity and market participation and performance following an increase in market prices in Mozambique. We use panel data before and after the change in price regime to identify the relative importance of market access/participation versus household and farm-level factors in explaining productivity differences. Conversely, we look at the relative importance of productivity investments and outcomes versus marketing investments in explaining household market performance. We find that between 2008, before the price increases, and 2011, there were increases in market participation rates and in the intensity of participation. Modest increases are also found in terms of productivity for all crop groups.
    Keywords: Agricultural and Food Policy, Food Security and Poverty, International Development, Marketing, Production Economics, Productivity Analysis, Research Methods/ Statistical Methods,
    Date: 2014–05
  15. By: Pablo Yanguas; David Hulme
    Abstract: Although politics has become central to international development assistance, the use of political economy analysis (PEA) as a means for greater aid effectiveness remains an aspiring epistemic agenda. Even though virtually all aid donors have some personnel working on the development and implementation of PEA methodologies and frameworks, whether this new cognitive model for aid is compatible with pre-existing administrative factors is still an open question. We argue that for PEA to become fully institutionalised in donor agencies it needs to overcome the hurdles of administrative viability: its proponents need to reconcile it with corporate and professional incentives, as well as with the political environment in which an agency operates. We track this process empirically within two PEA leaders: the UK Department for International Development (DFID) and the World Bank. Using documents and interviews from headquarters as well as three country offices – Bangladesh, Ghana, Uganda – we find that political economy analysis has not yet become institutionalised in programming, management or the professions, and remains an intellectual agenda very much rooted in the governance silo. We conclude by arguing that the future of PEA lies in organisational change, not any particular framework, and that this change is more likely to occur by disseminating PEA outside of the governance profession into agency management and the various sectors of development assistance.
    Date: 2014

This nep-afr issue is ©2014 by Christian Zimmermann. 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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