Thematic Policy Brief

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Adoption of Innovations and Productivity of Enterprises in French-Speaking sub-Saharan Africa: Case of Cameroon, Senegal and Ivory Coast
(2021-08) Dumas, Tsambou André; Ludwick, Ndokang Esone; Aline, Zobo
The productivity of firms is the result of many factors, including their ability to innovate. For most authors, innovation can be diversified into product, process, organization, and marketing innovation. The objective of this work is to highlight the impact of the adoption of innovations on firms’ productivity in Cameroon, Senegal, and Ivory Coast. This work is based on the survey "Determinants of firms’ performance in Francophone sub-Saharan Africa: The case of Cameroon, Ivory Coast and Senegal conducted among 1,897 companies (639 in Cameroon, 723 in Senegal and 535 in Ivory Coast) in 2014 by the International Development
Bank Competition and Financial Inclusion: Evidence from Ghana
(African Economic Research Consortium, 2021-08) Vera Fiador, Agyapomaa Gyeke-Dako; Agbloyor, Elikplimi Komla; Abor, Joshua Yindenaba
This paper investigates how banking sector competition, measured from the consumer's perspective as well as from financial intermediary pricing behaviour, affects financial inclusion in a developing country like Ghana. Financial inclusion in Ghana has remained low, leading us to examine if competition within banks (who happen to be the largest financial institutions) promotes financial inclusion. This paper measures competition using two indicators: the consumer-level measure of competition relating to the proliferation of bank branches, and a measure for banking sector competition using the funding-adjusted Lerner index
Banking Industry Competition and Stability in Zimbabwe
(African Economic Research Consortium, 2021-08) Makena, Philton
The study investigates the impact of changes in banking industry competition on the industry's stability in Zimbabwe using a sample of eighteen banks for the period 2009-2017. The period of study coincides with an era when the country experienced growth and stability (under full dollarization) after a decade of an economic crisis (prior to full dollarization). First, the study employs a modified version of the Boone (2008) indicator to establish the evolution of competition. Second, the Z-score is employed to investigate the nexus between banking industry competition and stability in the country.
Crop Commercialization and Nutrient intake among Farming Households in Uganda
(African Economic Research Consortium, 2021-08) Kilimani, Nicholas; Buyinza, Faisal; Guloba, Madina
Agricultural commercialization is seen as a pathway towards rural economic transformation as it is expected to enhance a wide array of household welfare indicators. This study examines the channels through which household nutrient intake is influenced in the process of crop commercialization. This was investigated using LSMS-ISA survey data for Uganda using the control function econometric approach. The results show that commercialization affects nutrient intake via crop income. Another crucial finding was that while rural-based households registered higher nutritional gains from crop commercialization,
Crop Commercialization and Nutrient Intake Among Farming Households in Uganda
(2022-06) Kilimani, Nicholas; Buyinza, Faisal; Guloba, Madina
Agricultural commercialization is seen as a pathway towards rural economic transformation as it is expected to enhance a wide array of household welfare indicators. This study examines the channels through which household nutrient intake is influenced in the process of crop commercialization. This was investigated using LSMS-ISA survey data for Uganda using the control function econometric approach. The results show that commercialization affects nutrient intake via crop income. Another crucial finding was that while rural-based households registered higher nutritional gains from crop commercialization, they were less commercialized on average. The role of markets as a key factor in the agricultural commercialization process was confirmed; households that had access to produce markets are more commercialized and have better nutrient intake. While male-headed households were found to practice more commercialization, their households have less nutrient intake compared to their female-headed counterparts. This finding is in line with the literature and casts a shadow on the nutritional benefits of agricultural commercialization given that the majority of households in Uganda are male headed. The findings point to two important implications. First, interventions geared towards agricultural commercialization are beneficial to household nutrition via income generation. T
Crop Diversification and Nutrition Outcomes in Smallholder Households: Panel Data Evidence from Southwestern and Northern Uganda
(2021-08) Namulondo, Racheal; Bashaasha, Bernard
This study examined the effect of adopting crop diversification on nutrition outcomes of smallholder households in southwestern and northern Uganda. We constructed three models of correlates of household dietary diversity, minimum dietary diversity for women, and stunting of children aged 6–59 months. A 3-year panel multi-topic dataset collected in 2012, 2014 and 2016 by USAID’s Feed the Future Nutrition Innovation Laboratory in southwestern and northern Uganda was utilized. Crop diversification was found to be positively and strongly associated with household dietary diversity, with the probability of achieving
The Dynamics of Horizontal Economic Inequality in Countries Affected by Ethnic Conflict
(African Economic Research Consortium, 2021-08) Ndayikeza, Michel Armel
This paper examines the dynamics of horizontal inequality in countries that have experienced ethnic conflict. This contrasts with previous studies which have focused on the effect of inequality on conflict. Understanding how conflict affects inequality serves to shed light on reasons behind conflict recurrence and slow economic development. The complex relationship between inequality and conflict is analyzed using both quantitative information, i.e., Demographic and Health Surveys (DHS) data from 36 countries for the time 1986-2018, and qualitative information, i.e., six country case studies. The focus throughout is
Export Efficiency and Diversification in Ghana
(2021-03) Obeng, Camara K.
Ghana needs to expand its export base to generate sufficient foreign exchange earnings for economic transformation. There is, therefore, a need to examine the efficiency of the existing export basket and explore new products to add to it. This study employs the stochastic frontier gravity model to investigate the efficiency of bilateral exports of Ghana using a panel of 44 export destination countries for the period 2000 to 2018. In addition, a product space analysis is carried out to ascertain which other products Ghana must diversify into in order to engender the transformation required for the attainment of Sustainable
Export Efficiency and Diversification in Ghana
(African Economic Research Consortium, 2022-05) Obeng, Camara K.
Ghana needs to expand its export base in order to generate sufficient foreign exchange earnings for economic transformation. There is, therefore, a need to examine the efficiency of the existing export basket and explore new products to add to it. This study employs the stochastic frontier gravity model to investigate the efficiency of bilateral exports of Ghana using a panel of 44 export destination countries for the period 2000 to 2018. In addition, a product space analysis is carried out to ascertain which other products Ghana has to diversify into in order to engender the transformation required for the attainment of Sustainable Development Goal 8. As a third objective, the study investigates the extent to which Ghana can leverage the African continental free trade area for its diversification agenda. The study finds that Ghana’s bilateral export trade is inefficient, implying huge potential exists. It further reveals that Ghana’s economic complexity is low, leading to the production and export of primary commodities. Moreover, the African continental free trade area offers an opportunity for Ghana to crystalise its export diversification drive. It is recommended that Ghana takes advantage of its membership of trade blocs to negotiate access to foreign markets, improve on logistics, enhance macroeconomic stability, step up vocational and technical education, and increase investment in land and reliable, cheap electricity in order to grow its exports.
Fiscal Policy and Monetary Integration in the ECOWAS
(African Economic Research Consortium, 2021-03) Onye, Kenneth; Umoh, Okon J.
Those with dissenting views regarding the structure of monetary union arrangement in the ECOWAS often argue that the macroeconomic convergence criteria have hampered the ability of countries in the region to stabilize their economies with appropriate counter-cyclical fiscal policy. We test the empirical merit of this assertion and found no support for this view. Instead, discretionary fiscal policy has become counter-cyclical in ECOWAS after the introduction of convergence criteria. In specifics, we found a switch from pro-cyclical fiscal policy making in the pre-convergence era (1995-2002) to a counter-cyclical fiscal policy
The Impact of Land Conflict on Land Productivity: Evidence from Liberia
(African Economic Research Consortium, 2022-03) Maiko, Akama Erick; Kollie, Genesis Bhenda
This paper examines both the correlates of land conflict and the effects of this conflict on crop yields, farmers’ investments in permanent trees and crops. The productivity effects of land conflict are estimated at the town-level considering the endogeneity of conflict. We use data from the Household Income Expenditure Survey (HIES) of Liberia and from the Innovations for Poverty Action (IPA) baseline survey for the same year. The main findings reveal that gender, distance from the farm to home or the road, soil quality, slope of the farmland, marital status, soil erosion, government extension services and age of the
Impact of School Quality on Schooling and Child Labour in Selected Zones of Ivory Coast
(African Economic Research Consortium, 2021-08) Edouard, Abou Pokou
The fight against child labour is a challenge for policy makers in developing countries. The objective of this study is to find other policies to reduce child labour. Thus, this research shows the effect of school quality on schooling and child labour in Ivory Coast. Primary data from the local survey on child labour and education policies in 2010 collected from a sample of 750 households and 1,338 children with support from PASRES were used. The estimation of two models (Heckman selection model and bivariate probit model) indicates that the presence of canteen and electricity in the school significantly increases the
Inclusive Growth in sub-Saharan Africa: Do Financial Depth and Inclusion Matter?
(African Economic Research Consortium, 2021-08) Jombo, Wytone
This study attempts to contribute to the existing literature by exploring the effect of financial inclusion and depth on inclusive growth for 26 sub-Saharan Africa countries. Using the random effects panel regressions, the results suggest that financial inclusion positively affects inclusive growth in the sub-Saharan region, while financial depth variable does not. At very high levels of financial inclusion, however, the results portray decreasing marginal effects of financial inclusion on inclusive growth. Evidence from this study, however, shows weak transmission channel from financial deepening indicators to inclusive growth.
Investigating the Sources of Asymmetric Growth and Inflation Shocks in the WAEMU Region
(2021-08) Tadenyo, Yao Dossa
Empirical research has already established the existence of asymmetric shocks between the countries of the West African Economic and Monetary Union (WAEMU). The current study re-examines this issue by attempting to answer the following question: are the asymmetries within the WAEMU region related to country specific shocks or do they stem from heterogeneous responses to common shocks? To answer this question, the study relied on the estimation of a bivariate structural VAR model for each WAEMU member country using annual data from
Land Tenure Insecurity, Fragmentation and Crop Choice: Evidence from Uganda
(African Economic Research Consortium, 2021) Mwesigye, Francis; Barungi, Mildred
This study uses household, parcel, and plot-level data to analyze the effect of land tenure insecurity and land fragmentation on crop choice. We use formal land titling as a proxy for de jure land rights, and the perceived transfer rights over parcels as a proxy for de facto land rights. Using two-part model, the study shows that both de jure and de facto land rights significantly increase the likelihood of planting perennial commercial crops, and increase the hectares allocated to commercial crops. The results also show that when the rights to land are weak (i.e., no land titling and no transfer rights), farmers tend to grow annual crops.
Landownership Inequality and Inequality in Education Attainment in Kenya
(2022-03) Gathiaka, John Kamau
Unequal asset ownership accompanies other socioeconomic inequalities so that the disparity in physical possessions, particularly land, is worth a rigorous analysis. The case in point is the inverse relationship that has been reported across countries between unequal landownership and education attainment. In Kenya, inequalities in landownership vary across and within counties, households included. Using data from the Kenya Integrated Household Budget Survey and the Kenya Population and Housing Census, the study applies a fractional IV probit regression model to examine the relationship between
Mobile Money Payment: An Antidote to Petty Corruption?
(African Economic Research Consortium, 2021-08) Barasa, Laura
Using a two-period panel comprising firm-level data from the 2007 and 2013 World Bank Enterprise Surveys, this paper investigates the impact of mobile money use on bribe payments in Kenya. Results based on a matched difference in-differences estimator demonstrate that adopting mobile money for financial transactions leads to a 3.1 percentage point reduction in bribe payments. This can be explained considering that mobile money transactions leave behind a detailed trail of digital records and accounts, which may curb acts of bribery. Our findings suggest that official mobile money payments can be a practical and effective anti-corruption intervention.
Women’s Empowerment in Agriculture and Child Nutritional Outcomes in Rural Burkina Faso
(2021-08) Nikiema, P. Rita; Kponou, M. Kenneth C.
Across developing countries, women play an important role both as producers of major food crops and in improving household nutrition. This research paper aims to assess the effect of improving women’s empowerment on the nutritional status of children in rural Burkina Faso. Based on data from the 2014 Multisectoral Continuous Survey (EMC), the paper uses variables such as income control, access to land, autonomy in production decisions, access to credit and social group membership to compute a composite index of women’s empowerment. Accounting for potential endogeneity of empowerment, the
WTO Trade Facilitation Measures and the Extensive Margin of Exports in the Tripartite: COMESA – EAC – SADC
(African Economic Research Consortium, 2021-08) Roland, Leudjou Njiteu Rostant
This study uses a gravity model for the year 2015 to analyze the impact of the World Trade Organization’s (WTO) Trade Facilitation Agreement (TFA) on extensive margin of exports (export diversification proxied by the number of products exported) by the Tripartite (COMESA, EAC and SADC) country members. It appears that all trade facilitation measures (except “fees and charges”) have a positive and significant effect on export diversification irrespective of the type of product or trading partner. “Appeal procedures” (the rights to traders to obtain review and correction of decisions made by Customs officials in an

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