|
on Africa |
| By: | Phume, Maphelane Palesa; Bonga-Bonga, Lumengo |
| Abstract: | South Africa and Nigeria are the wo biggest African economies by the size of their economies, translated in their gross domestic product (GDP). Portfolio investors who are interested to invest in the African stock markets should be interested in uncovering whether the two stock exchange markets complement and provide the opportunity for asset diversification or that the two markets are strictly substitutable. It is in that context that this paper evaluates the cross-transmission of returns and volatility shocks between the two countries to infer the extent of interdependence of the two stock exchange markets. Moreover, the paper makes inferences on optimal portfolio weights and hedge ratios when holding assets from the two markets. To that end, estimations based on multivariate GARCH (general autoregressive conditional heteroscedastic) model are used. The results of the empirical analysis suggest evidence of stock market returns and volatility spillovers from South African stock markets to Nigerian stock markets , and not other way around. Moreover, the results suggest that it is ideal to constitute a portfolio and set an optimal hedge ratio by combining assets from the South African and Nigerian stock markets and that investors should engage in dynamic rebalancing of portfolio weights and hedge ratio. |
| Keywords: | South Africa, Nigeria, return and volatility soillovers, equity markets, portfolio selection, hedge ratio. |
| JEL: | C5 G11 G15 |
| Date: | 2018–05–16 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:87638&r=afr |
| By: | Giorgio Chiovelli; Stelios Michalopoulos; Elias Papaioannou |
| Abstract: | Landmine contamination affects the lives of millions in many conflict-ridden countries long after the cessation of hostilities. Yet, little research exists on its impact on post-conflict recovery. In this study, we explore the economic consequences of landmine clearance in Mozambique, the only country that has moved from "heavily-contaminated" in 1992 to "mine-free" status in 2015. First, we compile a dataset detailing the evolution of clearance, collecting thousands of reports from the numerous demining actors. Second, we exploit the timing of demining to assess its impact on local economic activity, as reflected in satellite images of light density at night. The analysis reveals a moderate positive association that masks sizeable heterogeneity. Economic activity responds strongly to clearance of the transportation network, trade hubs, and more populous areas, while the demining-development association is weak in rural areas of low population density. Third, recognizing that landmine removal recon figured the accessibility to the transportation infrastructure, we apply a "market-access" approach to quantify both its direct and indirect effects. The market-access estimates reveal substantial improvements on aggregate economic activity. The market-access benefits of demining are also present in localities without any contamination. Fourth, counterfactual policy simulations project considerable gains had the fragmented process of clearance in Mozambique been centrally coordinated, prioritizing clearance of the colonial transportation routes. |
| JEL: | N17 O0 O1 O10 R0 |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24758&r=afr |
| By: | NYONI, THABANI |
| Abstract: | That corruption abounds in Nigeria is an indisputable fact (Agbiboa, 2012). The corrupt man is everywhere, the man on the street, the man next door, the man in the church or mosque, the man in the market or the departmental store, the policeman on beat patrol and the soldier at the check point (Okadigbo, 1987). Corruption in Nigeria has passed the alarming and entered the fatal stage (Achebe, 1983). The rate of corruption is so high that the Federal House of Representative in Nigeria is now contemplating hanging for treasury looters as a solution to corruption (Ige, 2016). Corruption is a clog in the wheel of progress in Nigeria and has incessantly frustrated the realization of noble national goals, despite the enormous natural and human resources in Nigeria (Ijewereme, 2015). Corruption cases have been on the increase despite anti – corruption crusades (Izekor & Okaro, 2018). Corruption dynamics in Nigeria reveal that politicians and public office bearers in Nigeria have proven beyond any reasonable doubt that they are not able to translate their anti – corruption “gospel” into action; theirs is to devour rather than share the “national cake”. Today Nigerians continue to languish in extreme poverty and yet Nigeria is one of the few African countries with abundant natural and human resource endowments. Nigerian political leadership (ruling or opposition) should be more serious when dealing with corruption, if economic growth and development is anything to go by in Nigeria. This study seeks to demystify the dynamics of both political and electoral corruption in Nigeria in relation to the Nigerian political landscape. Amongst other policy recommendations, the study urges Nigerian politicians to walk their talk on corruption. |
| Keywords: | Corruption, electoral corruption, political corruption, politicians, Nigeria |
| JEL: | E0 E5 H0 H3 |
| Date: | 2018–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:87615&r=afr |
| By: | Remi Jedwab; Felix Meier zu Selhausen; Alexander Moradi |
| Abstract: | One of the most powerful cultural transformations in modern history has been the dramatic expansion of Christianity outside Europe. Recent, yet extensive, literature uses Christian missions established during colonial times as a source of exogenous variation to study thelong-term effects of religion, human capital and culture in Africa, the Americas and Asia. We argue that the endogeneity of missionary expansion may be underestimated, thus questioning the link between missions and economic development. Using annual panel data on missions from 1751 to 1932 in Ghana as well as cross-sectional data on missions for 43 sub-Saharan African countries in 1900 and 1924, we show that: (i) locational decisions were driven by economic factors, as missionaries went to healthier, safer, and more accessible and developed areas, privileging the best locations first; (ii) these factors may spuriously explain why locations with past missions are more developed today, especially as most studies rely on historical mission atlases that tend to only report the best mission locations. Our study identifies factors behind the spatial diffusion of religion. It also highlights the risks of omission and endogenous measurement error biases when using historical data and events for identification. |
| Keywords: | Path Dependence; Economic Development; Economics of Religion; Human Capital; Compression of History; Measurement Error; Christianity; Colonization; Africa |
| JEL: | F54 L31 N37 O15 O17 Z12 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:2018-07&r=afr |
| By: | Davies, Elwyn; Fafchamps, Marcel |
| Abstract: | Experimental evidence to date supports the double theoretical prediction that parties transacting repeatedly punish bad contractual performance by reducing future offers, and that the threat of punishment disciplines opportunistic breach. We conduct a repeated gift-exchange experiment with university students in Ghana and the UK. The experiment is framed as an employment contract. Each period the employer makes an irrevocable wage offer to the worker who then chooses an effort level. UK subjects behave in line with theoretical predictions and previous experiments: wage offers reward high effort and punish low effort; this induces workers to choose high effort; and gains from trade are shared between workers and employers. We do not find such evidence among Ghanaian subjects: employers do not reduce wage offers after low effort; workers often choose low effort; and employers earn zero payoffs on average. These results also hold if we use a strategy method to elicit wage offers. Introducing competition or reputation does not significantly improve workers' effort. Using a structural bounds approach, we find that the share of selfish workers in Ghana is not substantially different from the UK or earlier experiments. We conclude that strategic punishment in repeated labor transactions is not a universally shared heuristic. |
| Keywords: | conditional reciprocity; Ghana; gift-exchange game; punishment strategies; relational contracting |
| JEL: | C71 D2 D86 E24 O16 |
| Date: | 2018–07 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:13057&r=afr |
| By: | Richard Adu-Gyamfi (International Trade Centre, Switzerland); John Kuada (Aalborg University, Denmark); Simplice Asongu (Yaoundé/Cameroon) |
| Abstract: | Despite the good intentions in sub-Sahara Africa (SSA), previous policy initiatives on entrepreneurship have been disjointed, unambitious, and implemented without commitment and required resources. Furthermore, there has been limited research that can provide insight into the reasons why some of the policy initiatives appear to be successful while others fail. Some scholars have suggested that without a context-specific classificatory guide, policymakers are unlikely to be accurate in their assessment of the growth capabilities of prospective candidates for specific promotion initiatives and this can explain some of the policy failures. This observation has motivated the present paper. Our aim is to provide a framework that helps identify the different contextual dimensions influencing enterprise creation processes in SSA. |
| Keywords: | Entrepreneurship; Africa |
| JEL: | O38 O40 O55 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:agd:wpaper:18/025&r=afr |
| By: | Lubinga, H. Moses; Ngqangweni, Simphiwe; Nyhodo, Bonani; Potelwa, X. Yolanda; van der Walt, Stephanie; Phaleng, Lucius; Ntshangase, Thandeka |
| Abstract: | Despite the increasing competitiveness of South Africa’s wine industry globally and the industry’s outstanding number of geographical indications (GIs), the impact of these GIs on wine exports has not been assessed (and if it has been assessed such work is not publicly available or not seen by the authors). Understanding the impact of the GIs is critical in enhancing informed policy decisions towards securing more geographical indicators for wines and other products. In addition, the unearthed evidence may be the basis for more government interventions in support of the initiative while protecting the good reputation in communities where production occurs. Based on E-Bacchus database for GI, we use the gravity flow model framework to empirically analyse the effect of GI on South Africa’s wine exports to the European Union (EU). Three proxies are used to capture the impact of GI. Results suggest that GI fosters South Africa’s wine exports into the EU irrespective of the proxy used. With respect to the dummies, GI leads to an increase in South Africa’s wine exports by about 170 percent (0.169, p<0.1). When the actual number of GI names was used, the estimated coefficient (0.007, p<0.1) also suggests that GI enhances wine exports into the EU by 0.7 percent. While using the difference between the number of GI names for South Africa and EU, findings show that GI is associated with 87 percent increase in wine exports. Conclusively, GI positively impact on South Africa’s wine exports into the EU. |
| Keywords: | Agribusiness, Agricultural and Food Policy, Crop Production/Industries, Food Security and Poverty, Industrial Organization, International Relations/Trade, Productivity Analysis, Research Methods/ Statistical Methods |
| Date: | 2017–09–11 |
| URL: | http://d.repec.org/n?u=RePEc:ags:zanamc:262912&r=afr |