nep-afr New Economics Papers
on Africa
Issue of 2015‒07‒11
six papers chosen by
Sam Sarpong
The University of Mines and Technology

  1. Governance and the Effectiveness of Public Health Subsidies By Dizon-Ross, Rebecca; Dupas, Pascaline; Robinson, Jonathan
  2. Does tenure insecurity explain the variations in land-related investment decisions in rural Ethiopia? By Muna Shifa; Murray Leibbrandt; Martin Wittenberg
  3. Why Do South Korean Firms Produce So Much More Output per Worker than Ghanaian Ones? By Baptist, Simon; Teal, Francis J.
  4. Causality and cointegration between export, import and economic growth: evidence from Morocco By El Alaoui, Aicha
  5. The Effect of Savings Accounts on Interpersonal Financial Relationships: Evidence from a Field Experiment in Rural Kenya By Dupas, Pascaline; Keats, Anthony; Robinson, Jonathan
  6. Pyramid capitalism : political connections, regulation, and firm productivity in Egypt By Diwan,Ishac; Keefer,Philip E.; Schiffbauer,Marc Tobias

  1. By: Dizon-Ross, Rebecca; Dupas, Pascaline; Robinson, Jonathan
    Abstract: Heavily subsidizing essential health products through existing health infrastructure has the potential to substantially decrease child mortality in sub-Saharan Africa. There is, however, widespread concern that poor governance and in particular limited accountability among health workers seriously undermines the effectiveness of such programs. We performed innovative audits on bed net distribution programs in three countries (Ghana, Kenya and Uganda) to investigate local agency problems and their determinants in the allocation of targeted subsidies. Overall, agency concerns appear modest. Around 80% of the eligible receive the subsidy as intended and leakage to the ineligible appears limited, even when the ineligible have a high willingness to pay. The estimated level of mistargeting only modestly affects the cost-effectiveness of free distribution.
    Keywords: extortion; leakage; motivation; shirking
    JEL: D73 H11 I15 I38
    Date: 2015–07
  2. By: Muna Shifa (School of Economics, University of Cape Town); Murray Leibbrandt (SALDRU, School of Economics, University of Cape Town); Martin Wittenberg (DataFirst, School of Economics, University of Cape Town)
    Abstract: We examine the relationship between land tenure security and land-related investments in rural Ethiopia. We control for both household heterogeneity and possible endogeneity of tenure security in estimating the impact of tenure security on investment. Empirical results show that variations in levels of tenure security do not explain the observed differences in investment behaviour among farm households in rural Ethiopia. In contrast, land size, access to labour and extension services, and location are seen to be important determinants of land-related investments. The results suggest that without addressing other barriers to investment, land reforms (titling) may not be sufficient to improve land-related investments.
    Keywords: Property rights, land tenure, land titling, agricultural extension services, Africa
    JEL: P14 Q15 Q16
    Date: 2015
  3. By: Baptist, Simon (Economist Intelligence Unit); Teal, Francis J. (University of Oxford)
    Abstract: Macro analysis of the sources of income differences has produced very different results as to the importance of education. In this paper we investigate the roles of education and technology in explaining differences in firm level productivity across Ghana and South Korea. The labour productivity differentials across these firms exceed those implied by macro analysis. Median value-added per employee is over thirty times higher in South Korean than in Ghanaian manufacturing firms. We show that if we allow for a non-linear effect of education on output the whole of the average productivity differences across the countries can be explained. We discuss the policy implications that flow from this finding.
    Keywords: African and Asian manufacturing, productivity, efficiency, human capital
    JEL: O14 D24
    Date: 2015–06
  4. By: El Alaoui, Aicha
    Abstract: This article investigates the relationship between export, import and economic growth using annual time series data for the Moroccan economy over the period 1980-2013. The cointegration technique has been employed to see the long run equilibrium relationship among variables. For this end, Granger causality test based on vector error correction model (VECM) has been adopted to see both short and long run causality among the variables. The cointegration results confirm the existence of the long-run relationship among these variables. For the short-run causality, the findings suggest (i) bidirectional causality between economic growth and import, (ii) unidirectional causality that run from export to import, and (iii) no-directional causality between economic growth and export.
    Keywords: Economic Growth, Export, Import, Granger Causality, Cointegration, VECM, Morocco
    JEL: C32 F41 O11
    Date: 2015–06
  5. By: Dupas, Pascaline; Keats, Anthony; Robinson, Jonathan
    Abstract: The welfare impact of expanding access to bank accounts depends on whether accounts crowd out pre-existing financial relationships, or whether private gains from accounts are shared within social networks. To study the effect of accounts on financial linkages, we provided free bank accounts to a random subset of 885 households. Within households, we randomized which spouse was offered an account and find no evidence of negative spillovers to spouses. Across households, we document positive spillovers: treatment households become less reliant on grown children and siblings living outside their village, and become more supportive of neighbors and friends within their village.
    Keywords: financial access; social insurance; spillovers
    JEL: C93 D14 G21 O16
    Date: 2015–07
  6. By: Diwan,Ishac; Keefer,Philip E.; Schiffbauer,Marc Tobias
    Abstract: This paper uses an original database of 469 politically connected firms under the Mubarak regime in Egypt to explore the economic effects of close state-business relations. Previous research has shown that political connections are lucrative. The paper addresses several questions raised by this research. Do connected firms receive favorable regulatory treatment? They do: connected firms are more likely to benefit from trade protection, energy subsidies, access to land, and regulatory enforcement. Does regulatory capture account for the high value of connected firms? In the sample, regulatory capture as revealed by energy subsidies and trade protection account for the higher profits of politically connected firms. Do politically connected firms hurt aggregate growth? The paper identifies the growth effects of the entry of politically connected firms by comparing detailed 4-digit sectors where they entered, between 1996 and 2006, and sectors that remained unconnected. The entry of connected firms into new, modern, and previously unconnected sectors slows aggregate employment growth and skews the distribution of employment toward less productive, smaller firms.
    Keywords: E-Business,Small Scale Enterprises,Economic Theory&Research,Banks&Banking Reform,Microfinance
    Date: 2015–07–02

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