ABSTRACT This paper uses a production function to examine the channels through which remittances ... more ABSTRACT This paper uses a production function to examine the channels through which remittances affect output per worker in 31 Sub-Saharan Africa (SSA) countries from 1980-2010. We find that remittances directly increase output per worker if complemented with education. The indirect effects vary with the economic characteristics of the recipient nations: while remittances have increased human capital among the low-income nations, among the upper-middle-income nations, they have mostly increased total factor productivity, but are still inversely related to factor inputs among the lower-middle-income nations of SSA. Finally, remittances are more effective when institutional risk is reducing.
ABSTRACT We survey about 110 recently published studies on Sino-African relations; put some struc... more ABSTRACT We survey about 110 recently published studies on Sino-African relations; put some structure on the documented issues before suggesting some solutions and strategies to the identified policy syndromes. The documented issues classified into eight main strands include, China: targeting nations with abundant natural resources; focusing on countries with bad governance; not hiring local workers; outbidding other countries by flouting environmental and social standards; importing workers that do not integrate into domestic society and living in extremely simple conditions; exhibiting low linkages between her operations and local businesses; exporting low quality products to Africa; and the emergence of China hindering Africa's development.
After investigating the effect of external financial flows on total factor productivity and techn... more After investigating the effect of external financial flows on total factor productivity and technological gain, we use the beta catch-up and sigma convergence to compare dispersions in output per worker, total factor productivity and technological gain in Sub-Saharan Africa (SSA) for the years 1980-2010. The comparative evidence is articulated with income levels, years of schooling, and health factors. We find; first, a positive association between foreign direct investment, trade openness, foreign aid, remittances and total factor productivity. However, when foreign direct investment is interacted with schooling, it is direct effect becomes negative on total factor productivity. Second, beta catch-up is between19.22% and 19.70% per annum with corresponding time to full catch-up of 25.38 years and 26.01 years respectively. Third, we find sigma-convergence among low-income nations and upper-middle income nations separately, but not for the entire sample together. Fourth, schooling in SSA is not yet a significant source of technology, but it can make external financial inflows more effective. Policies to induce external financial flows are not enough for development if absorptive capacity is low. More policy implications are discussed.
ABSTRACT We survey about 110 recently published studies on Sino-African relations; put some struc... more ABSTRACT We survey about 110 recently published studies on Sino-African relations; put some structure on the documented issues before suggesting some solutions and strategies to the identified policy syndromes. The documented issues classified into eight main strands include, China: targeting nations with abundant natural resources; focusing on countries with bad governance; not hiring local workers; outbidding other countries by flouting environmental and social standards; importing workers that do not integrate into domestic society and living in extremely simple conditions; exhibiting low linkages between her operations and local businesses; exporting low quality products to Africa; and the emergence of China hindering Africa's development.
Building on previous literature, we assess when foreign aid is effective in fighting terrorism us... more Building on previous literature, we assess when foreign aid is effective in fighting terrorism using quantile regressions on a panel of 78 developing countries for the period 1984-2008. Bilteral, multilateral and total aid indicators are used whereas terrorism includes: domestic, transnational, unclear and total terrorism dynamics. We consistently establish that foreign aid (bilateral, multilateral and total) is effective at fighting terrorism exclusively in countries where existing levels of transnational terrorism are highest. This finding is consistent with our theoretical underpinnings because donors have been documented to allocate more aid towards fighting transnational terrorist activities in recipient countries because they are more likely to target their interests. Moreover, the propensity of donor interest at stake is likely to increase with initial levels of transnational terrorism, such that the effect of foreign aid is most significant in recipient countries with the highest levels of transnational terrorism. Policy implications and future research directions are discussed.
ABSTRACT This paper uses a production function to examine the channels through which remittances ... more ABSTRACT This paper uses a production function to examine the channels through which remittances affect output per worker in 31 Sub-Saharan Africa (SSA) countries from 1980-2010. We find that remittances directly increase output per worker if complemented with education. The indirect effects vary with the economic characteristics of the recipient nations: while remittances have increased human capital among the low-income nations, among the upper-middle-income nations, they have mostly increased total factor productivity, but are still inversely related to factor inputs among the lower-middle-income nations of SSA. Finally, remittances are more effective when institutional risk is reducing.
Page 1. Is the East African Community an Optimum Currency Area? N. Kundan Kishor 1 University of ... more Page 1. Is the East African Community an Optimum Currency Area? N. Kundan Kishor 1 University of Wisconsin Milwauke John Ssozi University of Wisconsin Milwaukee September 2009 Abstract This paper investigates whether ...
One of the key economic development challenges facing Sub-Saharan Africa (SSA) is its low agricul... more One of the key economic development challenges facing Sub-Saharan Africa (SSA) is its low agricultural productivity. Governments, donors, and foreign investors have underinvested in African agriculture even though research evidence shows that higher agricultural productivity would boost economic growth and poverty reduction. Solutions to the problem require a number of interconnected strategies, including, but not limited to, research on seeds and inputs, extension services, rural development, credit, institutional, and trade and price stabilization policies. We use the system two-step Generalized Method of Moments to examine whether official development assistance (ODA) for agriculture and rural development is helping to boost agricultural productivity. We find a positive relationship between ODA and agricultural productivity. However, when broken down into the main agricultural ODA recipient sectors, there is a substitution effect between food crop production and industrial crop production. While there exists a positive relationship between ODA for industrial and export crops output per worker (agricultural productivity), ODA for food crops has a negative relationship. Better public institutions and economic freedom are also found to enable agricultural productivity growth and to increase the ODA effectiveness. We correct the results for spurious correlation assuming that more ODA might be allocated where agricultural productivity is already increasing due to some other factors. Concerning the determinants of ODA allocation, we find that the allocation of ODA for agriculture is primarily determined by agricultural need, and that the expected effectiveness increases the ODA receipts. Finally, there is a weak ODA-led structural economic change effect in SSA. Labor released from agriculture to the urban sector(s) has a positive market effect on agriculture but is not engendering significant structural economic transformation.
ABSTRACT This paper uses a production function to examine the channels through which remittances ... more ABSTRACT This paper uses a production function to examine the channels through which remittances affect output per worker in 31 Sub-Saharan Africa (SSA) countries from 1980-2010. We find that remittances directly increase output per worker if complemented with education. The indirect effects vary with the economic characteristics of the recipient nations: while remittances have increased human capital among the low-income nations, among the upper-middle-income nations, they have mostly increased total factor productivity, but are still inversely related to factor inputs among the lower-middle-income nations of SSA. Finally, remittances are more effective when institutional risk is reducing.
ABSTRACT We survey about 110 recently published studies on Sino-African relations; put some struc... more ABSTRACT We survey about 110 recently published studies on Sino-African relations; put some structure on the documented issues before suggesting some solutions and strategies to the identified policy syndromes. The documented issues classified into eight main strands include, China: targeting nations with abundant natural resources; focusing on countries with bad governance; not hiring local workers; outbidding other countries by flouting environmental and social standards; importing workers that do not integrate into domestic society and living in extremely simple conditions; exhibiting low linkages between her operations and local businesses; exporting low quality products to Africa; and the emergence of China hindering Africa's development.
After investigating the effect of external financial flows on total factor productivity and techn... more After investigating the effect of external financial flows on total factor productivity and technological gain, we use the beta catch-up and sigma convergence to compare dispersions in output per worker, total factor productivity and technological gain in Sub-Saharan Africa (SSA) for the years 1980-2010. The comparative evidence is articulated with income levels, years of schooling, and health factors. We find; first, a positive association between foreign direct investment, trade openness, foreign aid, remittances and total factor productivity. However, when foreign direct investment is interacted with schooling, it is direct effect becomes negative on total factor productivity. Second, beta catch-up is between19.22% and 19.70% per annum with corresponding time to full catch-up of 25.38 years and 26.01 years respectively. Third, we find sigma-convergence among low-income nations and upper-middle income nations separately, but not for the entire sample together. Fourth, schooling in SSA is not yet a significant source of technology, but it can make external financial inflows more effective. Policies to induce external financial flows are not enough for development if absorptive capacity is low. More policy implications are discussed.
ABSTRACT We survey about 110 recently published studies on Sino-African relations; put some struc... more ABSTRACT We survey about 110 recently published studies on Sino-African relations; put some structure on the documented issues before suggesting some solutions and strategies to the identified policy syndromes. The documented issues classified into eight main strands include, China: targeting nations with abundant natural resources; focusing on countries with bad governance; not hiring local workers; outbidding other countries by flouting environmental and social standards; importing workers that do not integrate into domestic society and living in extremely simple conditions; exhibiting low linkages between her operations and local businesses; exporting low quality products to Africa; and the emergence of China hindering Africa's development.
Building on previous literature, we assess when foreign aid is effective in fighting terrorism us... more Building on previous literature, we assess when foreign aid is effective in fighting terrorism using quantile regressions on a panel of 78 developing countries for the period 1984-2008. Bilteral, multilateral and total aid indicators are used whereas terrorism includes: domestic, transnational, unclear and total terrorism dynamics. We consistently establish that foreign aid (bilateral, multilateral and total) is effective at fighting terrorism exclusively in countries where existing levels of transnational terrorism are highest. This finding is consistent with our theoretical underpinnings because donors have been documented to allocate more aid towards fighting transnational terrorist activities in recipient countries because they are more likely to target their interests. Moreover, the propensity of donor interest at stake is likely to increase with initial levels of transnational terrorism, such that the effect of foreign aid is most significant in recipient countries with the highest levels of transnational terrorism. Policy implications and future research directions are discussed.
ABSTRACT This paper uses a production function to examine the channels through which remittances ... more ABSTRACT This paper uses a production function to examine the channels through which remittances affect output per worker in 31 Sub-Saharan Africa (SSA) countries from 1980-2010. We find that remittances directly increase output per worker if complemented with education. The indirect effects vary with the economic characteristics of the recipient nations: while remittances have increased human capital among the low-income nations, among the upper-middle-income nations, they have mostly increased total factor productivity, but are still inversely related to factor inputs among the lower-middle-income nations of SSA. Finally, remittances are more effective when institutional risk is reducing.
Page 1. Is the East African Community an Optimum Currency Area? N. Kundan Kishor 1 University of ... more Page 1. Is the East African Community an Optimum Currency Area? N. Kundan Kishor 1 University of Wisconsin Milwauke John Ssozi University of Wisconsin Milwaukee September 2009 Abstract This paper investigates whether ...
One of the key economic development challenges facing Sub-Saharan Africa (SSA) is its low agricul... more One of the key economic development challenges facing Sub-Saharan Africa (SSA) is its low agricultural productivity. Governments, donors, and foreign investors have underinvested in African agriculture even though research evidence shows that higher agricultural productivity would boost economic growth and poverty reduction. Solutions to the problem require a number of interconnected strategies, including, but not limited to, research on seeds and inputs, extension services, rural development, credit, institutional, and trade and price stabilization policies. We use the system two-step Generalized Method of Moments to examine whether official development assistance (ODA) for agriculture and rural development is helping to boost agricultural productivity. We find a positive relationship between ODA and agricultural productivity. However, when broken down into the main agricultural ODA recipient sectors, there is a substitution effect between food crop production and industrial crop production. While there exists a positive relationship between ODA for industrial and export crops output per worker (agricultural productivity), ODA for food crops has a negative relationship. Better public institutions and economic freedom are also found to enable agricultural productivity growth and to increase the ODA effectiveness. We correct the results for spurious correlation assuming that more ODA might be allocated where agricultural productivity is already increasing due to some other factors. Concerning the determinants of ODA allocation, we find that the allocation of ODA for agriculture is primarily determined by agricultural need, and that the expected effectiveness increases the ODA receipts. Finally, there is a weak ODA-led structural economic change effect in SSA. Labor released from agriculture to the urban sector(s) has a positive market effect on agriculture but is not engendering significant structural economic transformation.
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