nep-afr New Economics Papers
on Africa
Issue of 2015‒10‒10
five papers chosen by
Sam Sarpong
The University of Mines and Technology

  1. Donor’s double talk undermines African agency: Comparative study of civic agency in Burkina Faso and Togo By Kohnert, Dirk
  2. The nexus of structural transformation, employment and education: Evidence from Mozambique and Tanzania By ANITA V.STANEVAA; THEO SPARREBOOMB; HANY ABDEL-LATIFC
  3. Can Crop Purchase Programs Reduce Poverty and Improve Welfare in Rural Communities? Evidence from the Food Reserve Agency in Zambia By Fung, Winnie; Liverpool-Tasie, Saweda; Mason, Nicole; Uwaifo Oyelere, Ruth
  4. SMS Financing by banks in East Africa: Taking stock of regional developments By Adeline Pelletier
  5. Social Networks and Maternal Health Care Utilisation in Tanzania By Alfred K. Mukong and Justine Burns

  1. By: Kohnert, Dirk
    Abstract: Despite a long-standing controversy about aid-effectiveness in general and the impact of aid-dependency on governance in particular, little is known on the effect of donors policies on civic agency for democratization in aid dependent autocratic regimes. In this study it is argued that the long-term effects of double-talk of donors, who openly promote democracy and freedom but covertly follow overriding hidden interest, are a neglected source of failure of civic protest and democratic revolutions in autocratic regimes. The differing outcome of ‘democratic revolutions’ in Togo and Burkina Faso – both ‘aid darlings’ for decades - serves to substantiate this thesis. A systematic and holistic consideration is necessary for an unbiased evaluation of the hidden adverse impact of aid on collective action at the grass-roots. Therefore, a rethinking of temporal and disciplinary ‘fault lines’ in development politics as well as in development studies is essential.
    Keywords: Development cooperation, democratization, civic agency, autocratic regimes, Burkina Faso, Togo, West Africa, ODA, aid dependency,
    JEL: F35 F54 N47 N97 O21 Z1 Z13
    Date: 2015–10–06
    Abstract: Africa’s recent economic performance has been quite impressive. However, strong economic growth has not always corresponded to sufficient poverty reduction, partly because it has failed to generate productive employment. This paper compares the experiences of two fast growing African countries and provides an in depth insight on the different growth paths being pursued. In particular, the study aims to examine the role of education in facilitating structural changes in Mozambique and Tanzania. Building from micro-level estimates, we find that major structural change in the employment and economic structure in Tanzania and Mozambique was only to a limited extent translated into higher productivity add and decent work creation.
    Keywords: Structural transformation, returns to education, labour reallocation
    JEL: I2 J6 N3
    Date: 2015–06–01
  3. By: Fung, Winnie (Wheaton College); Liverpool-Tasie, Saweda (Michigan State University); Mason, Nicole (Michigan State University); Uwaifo Oyelere, Ruth
    Abstract: The last decade has seen a resurgence of parastatal crop marketing institutions in sub-Saharan Africa, many of which cite improving food security and incomes as key goals. However, there is limited empirical evidence on the welfare effects of these programs. This article considers one such program, the Zambian Food Reserve Agency (FRA), which purchases maize from smallholder farmers at a pan-territorial price that typically exceeds maize market prices in surplus production areas. Using both fixed effects and an instrumental variables approach combined with correlated random effects, we estimate the effects of the FRA's maize marketing activities on smallholder farm household welfare. Results suggest that FRA activities have positive direct welfare effects on the small minority of smallholder households that are able to sell to it. However, the results also suggest negative indirect FRA effects, as higher levels of FRA activity in a district are associated with higher levels of poverty.
    Keywords: crop marketing boards, strategic grain reserves, maize, smallholder farmers, income, poverty, Zambia, sub-Saharan Africa
    JEL: Q12 Q13 Q18 I38 D31 O13
    Date: 2015–09
  4. By: Adeline Pelletier (London School of Economics (LSE) in London)
    Abstract: The banking sector in East Africa has evolved considerably over the last 10-15 years with the regional expansion of African banks, coupled with financial innovations and regulatory changes. As a result, the banking landscape is marked by the co-existence of several types of banks: global banks from developed countries, emerging banks (mainly from Asian countries), foreign regional African banks and domestic African banks. Given the difficulty of access to credit experienced by SMEs, in a context of low transparency and information on borrowers, the expansion of regional African banks could have an important impact on the financial and economic development of the region. Indeed, if these regional banks are better able to evaluate SME credit risk than global banks, they might offer more loans to SMEs, thus fostering a sector which is the backbone of East African economies. In a constrained institutional setting, with a large unbanked population and little information available on borrowers, how do foreign and domestic banks screen and monitor borrowers? To what extent do regional African banks’ lending practices and perception of the business environment differ from that of domestic African banks and of global banks? What is the impact of the regional expansion of African banks on SME financing?
    Keywords: Finance, Kenya, Development
    Date: 2014
  5. By: Alfred K. Mukong and Justine Burns
    Abstract: Social networks are increasingly being recognised as having an important influence on the health market outcomes, as they facilitate the exchange of information on health care related issues. Networks reduce search costs by providing information to peers about the appropriate health care providers and details about the functioning of the health care system. In this paper, we examine the impact of information externalities generated through network membership on maternal health care utilisation in Tanzania. We further propose new approaches for quantifying the size of one's network. We adopt an econometric approach that minimises the problems of omitted variable bias. Using the Demographic and Health Survey data for Tanzania, a country characterised by low levels of maternal health care utilisation we find that social networks may enhance antenatal completion and early antenatal check-up probabilities by an additional 6-35 percent and sometimes up to 59 percent. The results suggest that failure to adequately control for omitted variables would lead to substantial under-estimation of the network eect. Finally, we show that irrespective of the measure of the size of the networks, high qualitynetworks have better outcomes than low quality networks.
    Keywords: Maternal Healthcare, Social Networks, Tanzania
    JEL: I11 Z13
    Date: 2015

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