nep-afr New Economics Papers
on Africa
Issue of 2018‒08‒27
seven papers chosen by
Sam Sarpong
The University of Mines and Technology

  1. Taxing Africa: Coercion, Reform and Development By Moore, Mick; Prichard, Wilson; Fjeldstad, Odd-Helge
  2. Mechanization in African Agriculture: A Continental Overview on Patterns and Dynamics By Kirui, Oliver K.; von Braun, Joachim
  3. Britain & Africa: heading for the Brexit rocks By Kohnert, Dirk
  4. Public Investment Efficiency in Sub-Saharan African Countries By Karim Barhoumi; Ha Vu; Shirin Nikaein Towfighian; Rodolfo Maino
  5. Lessons for Effective Fiscal Decentralization in Sub-Saharan Africa By Niko A Hobdari; Vina Nguyen; Salvatore Dell'Erba; Edgardo Ruggiero
  6. Africa on the maps of global values. Comparative analyses, based on recent World Values Survey data By Tausch, Arno
  7. What good is an oil sector without oil? How regime security and shorttermism explains DR Congo’s (non-)oil sector By Edmond, Patrick; Titeca, Kristof

  1. By: Moore, Mick; Prichard, Wilson; Fjeldstad, Odd-Helge
    Abstract: Taxation has been seen as the domain of charisma-free accountants, lawyers and number crunchers – an unlikely place to encounter big societal questions about democracy, equity or good governance. Yet it is exactly these issues that pervade conversations about taxation among policymakers, tax collectors, civil society activists, journalists and foreign aid donors in Africa today. Tax has become viewed as central to African development. Written by leading international experts, Taxing Africa offers a cutting-edge analysis on all aspects of the continent’s tax regime, displaying the crucial role such arrangements have on attempts to create social justice and push economic advancement. From tax evasion by multinational corporations and African elites to how ordinary people navigate complex webs of ‘informal’ local taxation, the book examines the potential for reform, and how space might be created for enabling locally-led strategies.
    Keywords: Governance,
    Date: 2018
  2. By: Kirui, Oliver K.; von Braun, Joachim
    Abstract: This study provides an overview on the patterns and dynamics of mechanization in African agriculture over the 10 year period (2005-2014). Farm level and value chain related mechanization are considered. This study looks in to pattern of agricultural mechanization along the entire value chain (production, post-harvest, processing, transport and storage) and compares it with the annual average agricultural output over the same time period. Clusters of countries are identified by grouping countries into those that have simultaneously experienced high growth rate in agricultural machinery and also in agricultural output, including; Angola, Botswana, Ethiopia, Malawi, Mali, Morocco, Niger, Rwanda, Tanzania, Togo, and Zambia. On the opposite side of the spectrum are countries with low growth in machinery and in agricultural output, and include for instance Madagascar, Zimbabwe, Uganda, and Egypt. In general, there is a positive correlation (of 0.52) between agricultural machinery growth and agricultural output growth in Africa, which is a classical two – way relationship, not to be interpreted as a causal one.
    Keywords: Agricultural and Food Policy, Crop Production/Industries, Production Economics
    Date: 2018–06–07
  3. By: Kohnert, Dirk
    Abstract: High-flying illusions on the part of the proponents and grim predictions of the sceptics characterize the controversy about Brexit. The article analyses five issues at stake for the Post-Brexit relationships between Britain, the EU and Africa with a focus on the Commonwealth Sub-Saharan Africa: market access, FDI, aid, security and partnership . The British government’s vision of a ‘Global Britain’ relies heavily on a reinforced co-operation with Commonwealth nations. However, most likely this would be possible only at the expense of the poor in Africa and elsewhere. Concerning security cooperation with Africa, London apparently exaggerated its defence input in order to enhance its bargaining position with the EU. It will be crucial for both the EU and UK to find post-Brexit agreements to stem irregular migration and the growth of jihadist groups and terrorism. In a nutshell, the analysis of these different policy field shows that expectations of Brexiteers and African politicians alike concerning an enhanced, partner-like Post-Brexit Commonwealth relationship are largely unfounded.
    Keywords: UK, Brexit, EU, Africa, international trade, tariffs, aid, security, partnership
    JEL: F10 F13 F2 F35 F54 G15 G2 H26 N17 N47 N77 O17 P16 Z13
    Date: 2018–08–15
  4. By: Karim Barhoumi; Ha Vu; Shirin Nikaein Towfighian; Rodolfo Maino
    Abstract: There is significant room to improve public investment efficiency in sub-Saharan Africa. Investment in sub-Saharan African countries is lagging vis-à-vis peers such as emerging and developing Asia as well as Latin America and the Caribbean, and the region’s infrastructure is perceived as being of relatively low quality. Improving the efficiency of sizable investment programs in the region could contribute to more solid economic growth and help achieve desired social priorities and development goals. Results point to some variability in public investment efficiency within the region. Comparing efficiency scores across country groups suggests that investment efficiency in sub-Saharan African oil exporters tends to be lower than in sub-Saharan African non-resource-intensive countries. Additionally, countries in East African Community (EAC) perform better than those in Central African Economic and Monetary Community (CEMAC) and West African Economic and Monetary Union (WAEMU). Stronger institutions could foster more efficient public investment. The regression results in this paper show a positive correlation between public investment efficiency and the quality of institutions, suggesting that devel-oping stronger institutions in sub-Saharan Africa could lead to a significant improvement in investment efficiency. This is particularly relevant for coun-tries with weak institutional quality, where governments may use capital spending as a vehicle for rent-seeking, leading to inefficient spending. Given the current drive for scaling up investment in sub-Saharan Africa, the task of improving institutions quickly should become a priority.
    Date: 2018–07–06
  5. By: Niko A Hobdari; Vina Nguyen; Salvatore Dell'Erba; Edgardo Ruggiero
    Abstract: Fiscal decentralization is becoming a pressing issue in a number of countries in sub-Saharan Africa, reflecting demands for a greater local voice in spending decisions and efforts to strengthen social cohesion. Against this backdrop, this paper seeks to distill the lessons for an effective fiscal decentralization reform, focusing on the macroeconomic aspects. The main findings for sub-Saharan African countries that have decentralized, based on an empirical analysis and four case studies (Kenya, Nigeria, South Africa, Uganda), are as follows: • Determinants and effectiveness: Empirical results suggest that (1) the major driving forces behind fiscal decentralization in sub-Saharan Africa include efforts to defuse ethnic conflicts, the initial level of income, and the urban-ization rate, whereas strength of democracy is not an important determi-nant for decentralization; and (2) decentralization in sub-Saharan Africa is associated with higher growth in the presence of stronger institutions. • Spending assignments: The allocation of spending across levels of gov-ernment in the four case studies is broadly consistent with best practice. However, in Uganda, unlike in the other three case studies, subnational governments have little flexibility to make spending decisions as a result of a deconcentrated rather than a devolved system of government. • Own revenue: The assignment of taxing powers is broadly in line with best practice in the four case studies, with the bulk of subnational revenue coming from property taxes and from fees for local services. However, own revenues are a very small fraction of subnational spending, reflecting weak cadaster systems and a high level of informality in the economy.
    Date: 2018–07–06
  6. By: Tausch, Arno
    Abstract: This paper attempts to close a gap in the recent literature on African economic development: the place of Africa on the maps of global economic, political and social values. We develop new comparable indices of global value development from the latest set of World Values Survey data and determine Africa’s place on a new factor analytical index of Global Civil Society. Our statistical calculations were performed by the routine and standard SPSS statistical program (SPSS XXIV), available at many academic research centers around the world and relied on the so-called oblique rotation of the factors, underlying the correlation matrix. The SPSS routine chosen in this context was the so-called promax rotation of factors, which in many ways must be considered to be the best suited rotation of factors in the context of our research. Our analysis of the World Values Survey data derived the following factor analytical scales, well compatible with a large social scientific literature: 1. The non-violent and law-abiding society 2. Democracy movement 3. Climate of personal non-violence 4. Trust in institutions 5. Happiness, good health 6. No redistributive religious fundamentalism 7. Accepting the market 8. Feminism 9. Involvement in politics 10. Optimism and engagement 11. No welfare mentality, acceptancy of the Calvinist work ethics The spread in the performance of African countries with complete data is really amazing. While we are especially hopeful about the development of future democracy in Ghana, our article suggests pessimistic tendencies for Egypt and Algeria, and especially for Africa’s leading economy, South Africa. High Human Inequality, as measured by the UNDP’s Human Development Report’s Index of Human Inequality, further impairs the development of Human Security. One can maintain that the certain recent optimism, corresponding to economic and human rights data, emerging from Africa, is reflected also in our Index of the Development of Civil Society. There is at least some hope for Africa, on this front, too. JEL Classification Numbers: C43, F5, Z12, D73
    Keywords: Keywords: C43 - Index Numbers and Aggregation; F5 - International Relations and International Political Economy; Z12 – Religion; D73 - Bureaucracy; Administrative Processes in Public Organizations; Corruption; C43 - Index Numbers and Aggregation; F5 - International Relations and International Political Economy; Z12 – Religion; D73 - Bureaucracy; Administrative Processes in Public Organizations; Corruption
    JEL: C43 D73 F5 Z12
    Date: 2018–07–16
  7. By: Edmond, Patrick; Titeca, Kristof
    Abstract: • The DRC has major possibilities for oil development, but very little actual development. • A major barrier is state inaction or blockages. • These emerge due to regime stability concerns. These are manifests in two key ways: The sector is a major source of patronage and rent-extraction. These rents are not created through the active production and development of the sector, but through selling access. Oil sector development is contrary to regime stability: internal geopolitics, regional relationships, and central control over major wealth are threatened by sector development. • These elements have not only prevented companies from exploration and production, but have discouraged further investor interest. • Change is unlikely. The disincentives which have blocked development in the past remain strong.
    Keywords: Congo; DRC; oil
    Date: 2018–08

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