nep-afr New Economics Papers
on Africa
Issue of 2020‒08‒10
six papers chosen by
Sam Sarpong
The University of Mines and Technology

  1. Building malls or metros?: South Africa's exports of tradable urban services to the rest of Africa By Ivan Turok; Justin Visagie
  2. Towards an effective fiscal stimulus: evidence from Botswana By Timuno, Sayed O.M; Eita, Joel Hinaunye
  3. Isolated and Poor: the cost of remoteness from the capital city By Provenzano, Sandro
  4. Property Rights and Economic Growth in Africa: An Econometric Analysis By Van, Germinal
  5. Natural Resources and the Salience of Ethnic Identities By Victoire Girard; Nicolas Berman; Mathieu Couttenier
  6. Understanding the cultural values at the individual level in central africa: A test of the cvscale in cameroon By Raoul Djamen; Laurent Georges; Jean-Louis Pernin

  1. By: Ivan Turok; Justin Visagie
    Abstract: Service industries are increasingly important in international trade and offer additional paths to economic development. There are many opportunities to expand trade in services between South Africa and other African countries. Improvements in urban planning, design, and governance are vital to create more productive and liveable cities. South Africa has many capabilities to support urbanization in Africa. However, South African companies have been relatively unsuccessful at exporting this expertise, and more successful at exporting retail, financial, and telecoms services.
    Keywords: Africa, International trade, South Africa, tradable urban services, urban infrastructure, Urbanization
    Date: 2020
  2. By: Timuno, Sayed O.M; Eita, Joel Hinaunye
    Abstract: While there is a general agreement on the effectiveness of fiscal stimulus, there is no consensus on which stimulus is better. To address this concern, this paper uses a Dynamic Stochastic General Equilibrium (DSGE) model to propose a fiscal stimulus that Botswana can adopt given the slowing mining productivity. The results suggest that short-run macroeconomic stabilisation can be achieved through a cut in labour taxes. This fiscal stimulus generates larger growth multipliers and contributes relatively more employment compared to a cut in consumption tax and increases in government spending. The findings also revealed that a cut in labour taxes improves trade balance, resulting in a greater accumulation of international reserves and has no Dutch disease effects. These results suggests the need for a labour tax policy reform. These results also offer some policy options for other developing countries which may face similar fiscal risks in future.
    Keywords: fiscal stimulus; fiscal policy, DSGE; Botswana
    JEL: C61 E62 H30
    Date: 2020–02–28
  3. By: Provenzano, Sandro
    Abstract: This paper investigates whether areas isolated from the capital city are less de- veloped economically in Sub-Saharan Africa. We apply a boundary-discontinuity design using national borders that divide pre-colonial ethnic homelands to obtain quasi-experimental variation in distance to the national capital city. Based on night- lights and geocoded surveys, we find that a one percent increase in distance to the capital city causes a decrease in the probability of detecting nightlights by 3 percent- age points and a reduction in household wealth corresponding to 3.5 percentiles of the national wealth distribution. Our results suggest that a lower provision of public goods in isolated areas is a key link between remoteness and economic performance. Despite receiving worse services, people who are isolated exhibit a higher level of trust in their political leaders. We interpret this as pointing towards dysfunctional accountability mechanisms that reduce the incentives of state executives to invest into isolated areas.
    Keywords: boundary discontinuity; capital city; economic growth; nightlights; public goods; spatial inequality; Sub-Saharan Africa
    JEL: D72 H41 O10 O40 R12
    Date: 2020–07
  4. By: Van, Germinal
    Abstract: The purpose of this paper is to establish a positive correlation between property rights and economic freedom. It seeks to demonstrate that property rights lead to economic freedom. From a purely theoretical perspective, it has been assumed that greater access to property rights leads to economic freedom, consequently to sustainable economic growth. To establish this correlation in the case of Africa, we applied the use of statistical tools to substantiate the validity of our economic theory. We mainly used a simple linear regression to ascertain our hypothesis.
    Keywords: economic freedom, property rights, econometrics, macroeconomics, development economics, economic growth
    JEL: C12 C53 O11 O4 O47
    Date: 2020–07–07
  5. By: Victoire Girard; Nicolas Berman; Mathieu Couttenier
    Abstract: This paper documents a new channel of the natural resource curse: the fragmentation of identities, between ethnic groups and nations. We combine individual data on the strength of ethnic – relative to national – identities with geo-localized information on the contours of ethnic homelands and on the timing and location of mineral resources exploitation in 25 African countries, from 2005 to 2015. Our strategy takes advantage of several dimensions of exposure to resources exploitation: time, spatial proximity, and ethnic proximity. We show that the strength of an ethnic group identity increases when mineral resource exploitation in that group’s historical homeland intensifies. This result holds independently of the impact of resources on local economic conditions and conflicts. We then investigate the various potential channels of transmission. Our findings suggest that feelings of economic deprivation and political exclusion associated with natural resources exploitation drive their impact on the strength of ethnic identities.
    Keywords: Identity, ethnicity, natural resources
    JEL: J15 N57 O55 Q32
    Date: 2020
  6. By: Raoul Djamen (GRANEM - Groupe de Recherche Angevin en Economie et Management - UA - Université d'Angers - AGROCAMPUS OUEST - Institut National de l'Horticulture et du Paysage); Laurent Georges (LGCO - Laboratoire Gouvernance et Contrôle Organisationnel - UT3 - Université Toulouse III - Paul Sabatier - Université Fédérale Toulouse Midi-Pyrénées); Jean-Louis Pernin (LERASS - Laboratoire d'Etudes et de Recherches Appliquées en Sciences Sociales - UT2J - Université Toulouse - Jean Jaurès - UT3 - Université Toulouse III - Paul Sabatier - Université Fédérale Toulouse Midi-Pyrénées - UM3 - Université Paul-Valéry - Montpellier 3)
    Abstract: In order to reduce the risk of failure, it is vital to learn about the different cultures around the world before doing business in other countries. Nonetheless, the existing cross-cultural business literature dealing with culture assessment methods has been widely criticized (Sharma, 2010). For instance, most studies operationalize personal cultural orientations for individual consumers based on the national scores on Hofstede (1980, 1991) cultural dimensions. In response to these concerns, the Cultural Values Scale (CVSCALE) is a 26-item scale that has been developed by Yoo, Donthu, and Lenartowicz (2011) to capture Hofstede's (1991) five cultural dimensions at the individual level. However, none previous studies have investigated these dimensions in Central Africa in general and specifically in Cameroon, a country which has many different ethnic groups. Therefore, the aim of this paper is to test the reliability and validity of the CVSCALE in Cameroon.
    Keywords: values,cvscale,Cameroon,Hofstede,culture
    Date: 2020

This nep-afr issue is ©2020 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.