nep-afr New Economics Papers
on Africa
Issue of 2018‒04‒23
seven papers chosen by
Sam Sarpong
The University of Mines and Technology

  1. Examining the whistle blowing Act of Ghana and it effectiveness in combating corporate crime By Ndebugri, Haruna; Senzu, Emmanuel Tweneboah
  2. Firm Financing Choices and Productivity in Sub Saharan Africa: Evidence from Firm Level Data By Naomi Mathenge; Eftychia Nikolaidou
  3. Credit Risk in African Microfinance Institutions: Correlates and International Comparisons By Eliud Moyi; Eftychia Nikolaidou
  4. A Work in Progress; Integrating Markets for Goods, Labor, and Capital in the East African Community By Emre Alper; Wenjie Chen; Jemma Dridi; Herve Joly; Fan Yang
  5. Cyclical Behavior of Fiscal Policy among Sub-Saharan African Countries By Tetsuya Konuki; Mauricio Villafuerte
  6. Do remittances enhance the economic growth effect of private health expenditures in West African Economic and Monetary Union? By Komivi Afawubo; Mawuli Kodjovi Couchoro
  7. Financial reforms and credit growth in Nigeria: Empirical insights from ARDL and ECM techniques By Adeleye, Ngozi; Osabuohien, Evans; Bowale, Ebenezer; Matthew, Oluwatoyin; Oduntan, Emmanuel

  1. By: Ndebugri, Haruna; Senzu, Emmanuel Tweneboah
    Abstract: The Study, sort to deeply investigate the structural dynamics of corporate crimes in public Institutions, which are recognized and recorded in the criminal records of Ghana and the effectiveness of the whistle blowing “Act”, which was passed in 2006 by the Parliament of the Republic of Ghana to curb the menace.
    Keywords: Corporate crime, Whistle blowing, Public Institution, Public servants
    JEL: K4
    Date: 2018–04–02
  2. By: Naomi Mathenge (School of Economics, University of Cape Town); Eftychia Nikolaidou (School of Economics, University of Cape Town)
    Abstract: This study examines the effect of firm financing choices on firm performance. Firm performance is measured by firm productivity, specifically, the Total Factor Productivity (TFP) of a firm. The study uses firm level data from the World Bank Enterprise Survey (WBES) to investigate the effect of different financing options on the productivity of SSA firms. Using data for the period 2005 - 2013 from 26 countries, the study employs a linear Cobb-Douglas production function to estimate total factor productivity (TFP.) It then uses both parametric and non-parametric methods to analyse the effect of financing options on TFP. The results indicate that firms that rely on bank debt rather than other forms of financing (e.g. internal finance, informal finance, private and public equity) are, on average, more productive. This can be partly attributed to the monitoring activities of banks and the threat of bankruptcy faced by firms.
    Date: 2018
  3. By: Eliud Moyi (School of Economics, University of Cape Town); Eftychia Nikolaidou (School of Economics, University of Cape Town)
    Abstract: Credit risk in African microfinance institutions seems to be rising, and the financial health of these institutions is becoming an issue of concern. Given this trend, this study seeks to unravel the factors that explain variations in credit risk in sub-Sahara African MFIsand, if such factors exist, to establish whether they have the same effects on credit risk in other developing regions. The study approach accommodates dynamic panel bias by applying system generalised method of moments estimators. Results suggest that the main predictors of credit risk in sub-Saharan Africa are lagged credit risk, loan growth, provision for loan impairment, GDP per capita growth and ease of getting credit. In addition, the study identifies threshold effects in the relationship between credit risk and loan growth. Credit risk falls with loan growth until a trough at 36.8% when this relationship is reversed.Further results from regional comparisons suggest that credit risk is most persistent in East Asia and the Pacific but least persistent in Sub-Saharan Africa.
    Date: 2018
  4. By: Emre Alper; Wenjie Chen; Jemma Dridi; Herve Joly; Fan Yang
    Abstract: This paper assesses the extent of economic and financial integration among the East African Community (EAC) along a number of dimensions and, where possible, whether integration has increased in the wake of the major regional integration policy milestones.
    Date: 2017–01–13
  5. By: Tetsuya Konuki; Mauricio Villafuerte
    Abstract: Excessively procyclical fiscal policy can be harmful. This paper investigates to what extent the fiscal policies of sub-Saharan African countries were procyclical in recent years and the reasons for the degree of fiscal procyclicality among these countries. It finds that a tendency for procyclical fiscal policy was particularly pronounced among oil exporters and after the global financial crisis. It also finds a statistically significant causal link running from deeper financial markets and higher reserves coverage to lower fiscal policy procyclicality. Fiscal rules supported by strong political commitment and institutions seem to be key to facilitating progress for deeper financial markets and stronger reserves coverage.
    Keywords: Fiscal analysis;Fiscal policy;Cyclical indicators;Sub-Saharan Africa;Oil exporting states;fiscal policy, sub-saharan Africa, oil exporters, financial markets,
    Date: 2016–08–24
  6. By: Komivi Afawubo (CEREFIGE - Centre Européen de Recherche en Economie Financière et Gestion des Entreprises - UL - Université de Lorraine); Mawuli Kodjovi Couchoro (CERFEG - Centre de Recherche et de Formation en Science Economique et de Gestion - Université de Lomé)
    Abstract: In this paper, we empirically analyze the relationship between private health expenditures and economic growth in West African Economic and Monetary Union (WAEMU), and the extent to which remittances moderate this relationship in a panel of WAEMU countries over the period 2000-2014. We use an endogenous growth model employing Fully Modified Ordinary Least Squares (FMOLS) and Ordinary Least Squares (OLS) methods. Our empirical results show that remittances have a positive and significant effect on economic growth. However, an increase in private health expenditures negatively affects the economic growth rate. Health expenditures may not lead to an increase in the level of human skills and an accumulation of human capital, and this situation decelerates economic growth. Furthermore, the interaction between remittances and private health expenditures has a negative effect on economic growth. These findings can be explained by the fact that the financing of private health expenditure through remittances is insufficient and inefficient and thus does not contribute to improving health status and building up human capital, which would play a part in economic growth.
    Date: 2017
  7. By: Adeleye, Ngozi; Osabuohien, Evans; Bowale, Ebenezer; Matthew, Oluwatoyin; Oduntan, Emmanuel
    Abstract: In the last 37 years Nigeria has undergone several stages of financial reforms with different impacts on the economy. Hence, this paper empirically analyses the impact of financial reforms on credit growth in Nigeria using annual data from 1980 to 2016. The research work hinges on the theoretical underpinning of the McKinnon-Shaw hypothesis on the relevance of financial reforms in a lagging economy. Analysing the data with autoregressive distributed lag (ARDL) error correction representation and bounds testing techniques, we notably find evidence to this hypothesis and state that at higher real interest rate there is increased financial intermediation evidenced by credit growth. Other findings are that in the long-run, financial system deposits, inflation rate and per capita GDP are strong asymmetrical predictors of credit growth and real interest rate (the financial reform indicator) while the short-run relationships are indicator-specific. We further show that a long-run cointegration relationship exists between domestic credit and other covariates and likewise between the real interest rate and its regressors.
    Keywords: autoregressive distributed lag; bounds testing, cointegration, credit growth, financial reform, interest rate
    JEL: E43 E44 G18 G19
    Date: 2017

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