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- ItemThe Devil is in the Details: On the Robust Determinants of Development Aid in G5 Sahel Countries(African Economic Research Consortium, 2023-09-28) Bayale, Nimonka; Kouassi, Brigitte Kanga KouassiThe authors are very grateful to the African Economic Research Consortium (AERC) for the financial support. Thanks to the Chair of thematic research Group C (Finance and Resource Mobilization) Victor Murinde (SOAS, University of London, UK) and our resource persons, including Issouf Soumare (Université Laval, Canada), Alessandra Guariglia (University of Birmingham, UK), Bo Sjö (Linköping University, Sweden) and Prosper Dovonon (Concordia University, Canada) for their insightful comments during the research phase, especially in the collection, analysis and interpretation of data. The lead author would also like to thank the United Nations Economic Commission for Africa (UNECA) for the use of their facilities during the completion of this paper as a Research Fellow with the Macroeconomic Policy Division (MPD) of the UNECA, Addis Ababa, Ethiopia. However, the views expressed are those of the author and do not represent that of the United Nations (UN) or the Central Bank of West African States (BCEAO) and the AERC. Finally, the authors are very grateful to the anonymous reviewers and the Editor-in-Chief of Comparative Economic Studies, whose comments have greatly improved this paper.
- ItemLong-Term Effects of Free Primary Education on Educational Achievement: Evidence from Lesotho(African Economic Research Consortium, 2023-08) Moshoeshoe, RamaeleMany Sub-Saharan African countries have instituted Free Primary Education (FPE) policies, which significantly increase primary school enrolment rates in developing countries. However, school attendance is different from learning. The main questions that still beg for answers are whether the many children in school are learning and whether the FPE learning effects are long-lasting. This paper attempts to estimate the long-term effects of the FPE programme on educational achievement in Lesotho. The programme was implemented grade by grade, beginning with grade one school fees abolition in 2000. The timing of the implementation created changes in programme coverage across age (and grade) groups over time. I employ a semi-parametric difference-in-differences strategy that exploits these variations to identify the long-term effects of the FPE policy on educational achievement, using university examinations record data for student cohorts that are FPE-treated and those that are FPE-untreated. The results indicate that the FPE effect on academic performance is between 2 percentage points (statistically insignificant) and 20 percentage points (statistically significant at 1%).
- ItemOptimal Monetary Policy with Inflation, Output and Asset Price Volatility in an Open Economy(African Economic Research Consortium, 2023-08) Wamalwa, PeterThis paper aims to establish optimal response of monetary policy to output, inflation, and asset price volatility in small open economies of Kenya and Ghana. The paper estimates a monetary policy response function for inflation, asset prices, and output volatility developed from a dynamic stochastic general equilibrium model using quarterly data from 2000 to 2018. The analysis shows that monetary policy accord inflation greatest weight Compared to output and asset prices. However, there are differences in the sensitivity of monetary policy across the economies, and hence price, output, and welfare outcomes. The prioritization of inflation stifles output growth more in Ghana than in Kenya due to high interest rate. Despite monetary policy prioritizing inflation in Ghana, average inflation is higher compared to Kenya. Results from dynamic optimization shows that, a consistent intervention in the economy to stabilize inflation, output, nominal exchange rate, and asset prices, achieves higher welfare.
- ItemGendered Effects of Climate Shock, Formal and Informal Financial Institutions, and Welfare in Post-Conflict Somalia(African Economic Research Consortium, 2022-10) Mesfin, Hiwot; Ahmed, Musa HasenThis study investigates the impact of climate shock on Somali households’ welfare status, and examines the mediating roles of formal and informal financial institutions— mobile banking and remittances—in enhancing households’ coping capacity. Using representative panel data, we show that climate shock has adverse effects on multiple welfare indicators for both female- and male-headed households. However, we find that female-headed households are more likely to fall below the poverty line, have a larger poverty depth, and shift their diet due to climate shock than male-headed households. Interestingly, we find that remittances decrease following climate shock, both on average and for female-headed households, but such reduction does not have a significant adverse effect on the households’ coping ability. This could be an indication that Somali households rely on other coping mechanisms to shocks than remittances. Similarly, even though we find that mobile money increases the likelihood of receiving remittances, we find no evidence that this translates into a higher coping ability to climate shock. Further investigation is needed to identify Somali households’ coping strategies
- ItemDoes Mobile Money Adoption and Credit Access Improve Innovation and Performance of Enterprises in Sierra Leone?(2022-10) Djossou, Gbetoton Nadege; Novignon, JacobThis study sought to unpack the impact of mobile money adoption and credit constraints on product innovation and performance of Micro, Small and Medium scale Enterprises in Sierra Leone. We used the most recent Sierra Leone Enterprise survey data conducted by the World Bank to monitor enterprises. To achieve the objectives of the study, we used Ordinary Least Square and non-experimental techniques (instrumental variable techniques). This allowed us to account for potential endogeneity problems that may bias parameter estimates if not accounted for. Our findings show that credit constraints significantly limited firms' ability to innovate, and thereby their performance. We also found that the use of mobile money improved innovation. We did not find any statistically significant gender-related variation in the relationship.