nep-afr New Economics Papers
on Africa
Issue of 2017‒11‒19
four papers chosen by
Sam Sarpong
The University of Mines and Technology

  1. The Effects of Land Markets on Resource Allocation and Agricultural Productivity By Chaoran Chen; Diego Restuccia; Raul Santaeulalia-Llopis
  2. Measuring Degree of Globalization of African Countries on Almost Equimarginal Contribution Principle By Mishra, SK
  3. How do African SMEs respond to climate risks? Evidence from Kenya and Senegal By Florence Crick, Shaikh Eskander, Sam Fankhauser, Mamadou Diop
  4. Burundi’s constitutional amendment: what do we know so far? By Vandeginste, Stef

  1. By: Chaoran Chen; Diego Restuccia; Raul Santaeulalia-Llopis
    Abstract: We assess the role of land markets on factor misallocation in Ethiopia--where land is owned by the state--by exploiting policy-driven variation in land rentals across time and space arising from a recent land certification reform. Our main finding from detailed micro data is that land rentals significantly reduce misallocation and increase agricultural productivity. These effects are nonlinear across farms--impacting more those farms farther away from their efficient operational scale. The effect of land rentals on productivity is 70 percent larger when controlling for non-market rentals--those with a pre-harvest rental rate of zero. Land rentals significantly increase the adoption of new technologies, especially fertilizer use.
    Keywords: Productivity, agriculture, land markets, rentals, misallocation, micro data.
    JEL: E02 O11 O13 O55 Q1
    Date: 2017–11–11
  2. By: Mishra, SK
    Abstract: This paper is an exercise in construction of an alternative globalization index for 43 countries in Africa. It has used a new method for measurement of the degree of globalization (or construction of a globalization index) based on minimization of the Euclidean norm of the Shapley values, the concept borrowed from the cooperative game theory. It assigns weights to constituent variables such that their mean expected marginal contribution to the synthetic index is as equitable as possible. Since this index is based on combinatorial logic, it is also less likely to be affected by outlier data points. Globalization index for 43 African countries (for a time series of 45 years, 1970-2014) has been constructed. The new index has been compared with the KOF index of globalization for the countries under study. As its validation, it has been found that the index has stronger correlation (vis-à-vis the KOF index) with Human Development index, Corruption Perception index, Freedom index and the indicators of abject poverty in the African countries. Viewed as such the new index represents globalization closely in connection with other relevant socio-economic measures than its rival (KOF index of globalization) as well as it is based on more plausible theoretical premises based on marginal contribution rather than correlation.
    Keywords: Globalization; synthetic index; African countries; Shapley values; Equi-marginal contribution.
    JEL: C43 C71 F02 O55
    Date: 2017–11–10
  3. By: Florence Crick, Shaikh Eskander, Sam Fankhauser, Mamadou Diop
    Abstract: This paper investigates to what extent and how small and medium-sized enterprises (SMEs) in poor countries are adapting to climate risks. We collect data from 325 SMEs in the semi-arid regions of Kenya and Senegal and use this information to estimate the quality of current adaptation measures, distinguishing between sustainable adaptation and reactive coping. We then study the link between these current adaptation practices and adaptation planning for future climate change. We find that financial barriers are a key reason why firms resort to reactive coping mechanisms, while general business support, access to information technology and adaptation assistance encourages sustainable adaptation responses. Engaging in adaptation today also increases the likelihood that a firm is preparing for future climate change. The finding lends support to the strategy of many development agencies who use adaptation to current climate variability as a way of building resilience to future climate change. There is a clear role for public policy in facilitating good adaptation. The ability of firms to respond to climate risks depends in no small measure on factors that can be shaped through policy intervention.
    Date: 2017–11
  4. By: Vandeginste, Stef
    Abstract: For the past five years, since the 2012 New Year's address by President Nkurunziza, the future of Burundi's constitution has been a controversial issue. On 15 November 2017, a commission in charge of drafting a constitutional amendment bill will conclude its activities. What do we know so far about the constitutional change? The short answer is: very little. Nevertheless, some insights and questions arise when looking at (i) the process and time-line of the constitutional amendment, (ii) some legal procedural challenges and (iii) the officially communicated or informally leaked substantive points. Structured along these lines, the purpose of this Brief is to present a state of the art. The purpose is not to judge the desirability of a constitutional amendment which for the government is a matter of national sovereignty and which some opposition groups have referred to as a declaration of war and a red line that should not be crossed.
    Keywords: Burundi; constitution
    Date: 2017–11

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