nep-afr New Economics Papers
on Africa
Issue of 2017‒09‒03
four papers chosen by
Sam Sarpong
The University of Mines and Technology

  1. The analysis of borders effects in intra-African trade By Emilie Kinfack Djoumessi; Alain Pholo Bala
  2. Mining taxation in Africa: The gold mining industry in 14 countries from 1980 to 2015 By Bertrand Laporte; Céline De Quatrebarbes; Yannick Bouterige
  3. Is Chad affected by Dutch or Nigerian disease? By Sandrine Kablan; Josef Loening
  4. Sustainability development: Biofuels in agriculture By Cheteni, Priviledge

  1. By: Emilie Kinfack Djoumessi; Alain Pholo Bala
    Abstract: The study aims to analyze the border effects on intra-African trade through the use of a gravity specification based on the monopolistic competition model of trade introduced by Krugman (1980). The study used CEPII data on trade flows between African countries over the period 1980-2006. We accommodate for the significant number of zero trade flows between several African countries by using the Heckman correction method. The findings suggest that while the extent of market fragmentation is on average very high within the African continent, the border effects within SADC and ECOWAS are more in line with other international estimations. Whereas results indicate that border effects faced by intra-African trade are quite substantial: on average an African country trade 108 times more "with itself" than with another country on the continent. Border effects in SADC and ECOWAS are respectively about 5 and 3 times lower. The inclusion of the infrastructure indices contributes significantly to this result. Considering infrastructure is actually an interesting way to capture the effect of distribution networks which represent, along with imperfect information and localized tastes, relevant but generally omitted sources of resistance.
    Keywords: Intra-Africa Trade, Monopolistic Competition Model, Border Effect
    JEL: F12 F14 F15
    Date: 2017–08
  2. By: Bertrand Laporte (CERDI - Centre d'Études et de Recherches sur le Développement International - UdA - Université d'Auvergne - Clermont-Ferrand I - CNRS - Centre National de la Recherche Scientifique); Céline De Quatrebarbes (FERDI - Fondation pour les études et recherches sur le développement international - FERDI [FERDI]); Yannick Bouterige (FERDI - Fondation pour les études et recherches sur le développement international - FERDI [FERDI])
    Abstract: The lack of information about the sharing of mining resource rent between governments and investors is an easy statement to make for Africa. The existing datasets are often insufficient for a deep analysis of African tax law as applied to the natural resource sectors, which has limited the academic and operational approaches. This paper describes the first legal and tax database which specifies the tax regime applied to industrial gold mining companies in 14 African gold-producing countries from 1980 to 2015. The database has three major innovations: (i) an inventory of taxes and duties (rate, base and exemptions) payable during the prospecting phase and mining phase of a gold project; (ii) a new detailed historical record covering 1980 to 2015; (iii) the link between each piece of tax information and its legal source. This database is used to make a first analysis of mining tax regimes and rent sharing in the main gold-producing countries. The first results highlight the heterogeneity of tax regimes between English-speaking and French-speaking countries. There has been a convergence of the average effective tax rates across most of the countries, the effective tax rate has increased in most countries following the tax reforms undertaken since 2010.The database is downloadable following the link :
    Keywords: Mining sector,Gold,Taxation of natural resources,Database.
    Date: 2017–06–22
  3. By: Sandrine Kablan (ERUDITE - Equipe de Recherche sur l’Utilisation des Données Individuelles en lien avec la Théorie Economique - UPEM - Université Paris-Est Marne-la-Vallée - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12); Josef Loening (The World Bank - The World Bank - The World Bank)
    Abstract: We examine the effects of the ‘natural resource curse’ on Chad and find little evidence for Dutch disease. Structural vector auto-regression suggests that changes in domestic output and prices are overwhelmingly determined by aggregate demand and supply shocks, and while oil production and high international prices negatively affect agricultural output, the effects are small. Consistent with empirical evidence for neighbouring Cameroon, we observe minimal impact on Chad’s manufacturing sector. We associate our findings with structural underemployment and the inefficient use of existing production factors. In this context, increased public expenditures in tradable sectors present the opportunity to make oil revenues an engine of national development.
    Date: 2017–05–24
  4. By: Cheteni, Priviledge
    Abstract: Biofuels are socially and politically accepted as a form of sustainable energy in numerous countries. However, cases of environmental degradation and land grabs have highlighted the negative effects to their adoption. Smallholder farmers are vital in the development of a biofuel industry. The study sort to assess the implications in the adoption of biofuel crops by smallholder farmers. A semi-structured questionnaire was administered to 129 smallholder farmers who were sampled from the Eastern Cape Province in South Africa. A binary probit model was used to investigate the determinants of smallholder farmers adopting biofuel crops. The empirical results showed that the variables membership in association, occupation and incentives were statistically significant in influencing farmers’ decision to adopt biofuel crops. Furthermore, it was discovered that the studied areas have a potential to grow biofuel crops.
    Keywords: Agriculture, Biofuels, Binary Model, Sustainable Development, South Africa
    JEL: Q5 Q58
    Date: 2017–01–05

This nep-afr issue is ©2017 by Sam Sarpong. 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.