Working Paper Series


Working Paper 229 - Structural change, economic growth and poverty reduction – Micro-evidence from Uganda

Within the debate on effective sectoral strategies for growth and poverty reduction in Sub-Saharan Africa, there has been recently a renewed attention to the role of structural transformation (AfDB African Economic Outlook 2013). There exists basically two options to grow and get out of poverty; within-sectoral productivity growth in the assets held by the poor, i.e., land and labor (McArthur and McCord2014; Binswanger et al. 2010; Ravallion and Datt 1996) and inter-sectoral mobility by reallocating labor from low-productivity sectors to higher-productivity ones, i.e., structural...

Working Paper 230 - Child Labour and Schooling in South Sudan and Sudan: Is There a Gender Preference?

Over the last decades, gender equality and women’s empowerment have been recognized as important dimensions of development strategies throughout the world and particularly in Africa where inequalities are salient. They are not only drivers of a population’s well-being but also key for reducing poverty and fostering sustainable development. They are also human rights universally promoted as stated in the United Nations Millennium Declaration in 20002 . Women’s economic and social disadvantages have been identified as important determinants of the persistence of poverty because mothers’...

Working Paper 226 - Aid Unpredictability and Economic Growth in Kenya

Foreign aid forms one of the largest components of foreign capital flows to low-income countries (Radelet, 2006). The question as to how foreign aid affects the economic growth of developing countries has drawn the attention of many scholars over time. The results of their studies have been varied.

Working Paper 227 - Public Debt Sustainability in Africa: Building Resilience and Challenges Ahead

Shortly after being impacted by the global financial crisis in 2009, Africa staged a robust recovery. Currently (mid-2015), it is one of the fastest growing world regions.2 Growth performance is projected to stay strong in the rest of 2015 and in 2016, the uneven global recovery notwithstanding (IMF, 2015). Several studies have pointed out Africa’s potential to become a global growth pole over the longer term (AfDB et al., 2010; ECA, 2012). The vast infrastructure and human capital gaps constrain Africa’s development. Balancing the need to scale up growth-enhancing public outlays and debt...

Working Paper 224 - La Sophistication des Exportations des Fruits, Légumes et Dérivés dans l’Espace UEMOA

Le présent papier se propose d’analyser les exportations des fruits, légumes et dérivés dans les pays de l’UEMOA à partir de l’instrument de mesure de la sophistication des exportations proposé par Hausmann, Hwang et Rodrik2 (2007). Ceci, pour apprécier l’ampleur de la diversification de cette catégorie dans la perspective de la transformation structurelle. Trois raisons justifient cet objet. La première, les fruits et légumes sont vivement recommandés, en matière de santé/nutrition par l’Organisation mondiale de la Santé (OMS), relayé par les pouvoirs publics des pays développés comme des...

Working Paper 225 - Measuring the Impact of Micro-Health Insurance on Healthcare Utilization: A Bayesian Potential Outcomes Approach

Affordable health insurance improves utilization of healthcare services and provides financial protection against catastrophic out-of-pocket health expenditures. However, functioning health insurance systems are lacking in many low-income countries. Private health insurance markets and employment-based health insurance systems are not accessible for the majority of the population. As a result, significant proportion of the population has low healthcare utilization rate and faces healthrelated income shocks. In recent years, Community-Based Health Insurance (CBHI) schemes have become popular...

Working Paper 223 - Eliminating Extreme Poverty in Africa: Trends, Policies and the Role of International Organizations

In the early 2015, ‘eradicating extreme poverty for all people everywhere by 2030’ topped the list of UN Sustainable Development Goals (SDGs) expected to guide the post-2015 development agenda (UN, 2014).2 Given Africa’s potential and the track record, its poverty eradication agenda beyond the MDGs should focus on wealth creation and prosperity, together with reduced inequality. These goals can be achieved through growth that is high, but also of higher quality, namely inclusive and green. In other words, as Africa becomes a global growth pole in its own right, its growth should benefit all...

Working Paper 222 - Economies of Scale in Gold Mining

Mergers and acquisitions news have become ubiquitous in the mining industry. In some commodities (such as steel and iron ore), global production has become increasingly concentrated within a small number of larger firms. A large part of these concentrations have been driven by vertical integration, especially in steel, to reduce cost for key inputs such as iron, ore and manganese (Crompton and Lesourd 2008; Gajigo et al. 2011). In addition to mergers and acquisitions, the average sizes of mines have become larger. As documented in Crowson (2003), the number of mines has decreased while the...

Working Paper 221 - Employment Effects of Multilateral Development Bank Projects The Case of the African Development Bank

Africa has made strong economic gains over the past decade, with real GDP growth averaging above 5 %. However, this growth has not been very transformative, particularly in creating large scale formal jobs (Page and Shimeles, 2014). Weak job creation has in turn slowed down the pace of poverty reduction and could threaten political and social stability as demonstrated by events in North Africa. High unemployment and poverty are therefore two most pressing challenges currently facing the African continent.

Working Paper - 219 - Impact of the business Environment on Output and Productivity in Africa

Africa is by far the poorest part of the world. Although several African countries have recently experienced positive economic development outcomes, it is clear that there has been a failure to develop sound policies in many African countries. In particular, African countries rank poorly in most dimensions of business environment that are essential to long-term business success. Table 1 compares different indicators of the business environment from the World Bank Enterprise Surveys (ES) for the OECD and Sub-Saharan Africa (SSA).1 It is clear that firms in SSA are highly constrained compared...

Working Paper - 220 - Developing a Food (in) Security Map for South Africa

South Africa has for long been food secure as a nation. This being the case, however, food insecurity at the household level is becoming a challenge as majority of households are becoming more food insecure (Altman, Hart, Jacobs, 2009). This is supported by the following estimates – 50% by National Department of Agriculture (2002), 52% by Labadarios, et al (2009), and 80% by Jacobs (2009). The differences in the above national level estimates could be ascribed to the measurement used (under nutrition versus undernourishment) and the type of survey data relied on (Income and Expenditure...

Working Paper - 218 - Household Energy Demand and the Impact of Energy Prices: Evidence from Senegal

Fossil fuel subsidies are often used by governments to promote eonomi development or alleviate poverty. But they have been proven as an ineient means of ahieving their primary goal of poverty redution. Rather they have reated market distortions and enouraged wasteful onsumption. The reent energy risis has ontributed to make fossil fuel subsidies very ostly and unsustainable for government budget and eonomi growth, espeially for many Afrian ountries. This situation has alled for urgent poliy ations to reform these subsidies.

Working Paper - 216 - Inflation Targeting Monetary Policy, Inflation Volatility and Economic Growth in South Africa

This paper investigates the impact of inflation targeting monetary policy and inflation volatility on economic growth in South Africa. Until at least the early 1970s, monetary policy was regarded as ineffective in controlling inflation. Governments relied on fiscal policy to stabilize the economy and keep inflation low. However, beginning in mid-1970s monetary authorities in advanced economies attempted to control inflation using monetary aggregates (M3, M2 or M1) with some success. Nonetheless, the instability between monetary targeting and goal variables (inflation and income) made this...

Working Paper - 217 - Capital Account Policies, IMF Programs and Growth in Developing Regions

Africa, as other developing regions, has experienced a surge in private capital inflows since the early 2000s (Dorsey et al., 2008; AfDB et al., 2013). Since large capital inflows and their sudden reversals can lead to inflation and major growth and exchange rate volatility and even crisis, they require appropriate policies. Capital controls are one of the measures, but come with substantial cost (Edwards, 1999; Brixiová et. al., 2010; Ncube et al., 2012; IMF, 2013a). How prepared are the African policymakers for making the most out of capital inflows while mitigating their cost? Until...

Working Paper 119 - Migration Patterns, Trends and Policy Issues in Africa

Migration and its role for development received substantial interest recently that sparked a large body of empirical studies to identify and provide evidence on the channels in which the two are interlinked. Resurgence of interest is further fuelled by the global economic and financial crisis that crippled labor markets across major destination countries in the OECD where the midterm outlook is still fragile. UNDP’s HDR(2009) focused on migration issues and OECD now has a dedicated annual publication on Migration Outlook where in its 2009 edition acknowledged that migration is a topical issue...

Working Paper - 211 - Bank Lending Channel of Monetary Policy Transmission in Zambia: Evidence from Bank-Level Data

Monetary policy, acting through various channels, has important macroeconomic and welfare implications. Studies have identified different channels of monetary policy transmission, broadly classified as ‘price’ and ‘credit’ transmission channels (Cecchetti, 1995; Bernanke & Gertler, 1995)4 . The applicability of these channels varies across countries, largely due to differences in level of financial sophistication, intensity of government regulation, and macroeconomic and structural conditions, among other factors. Therefore, understanding the mechanism through which monetary policy is...

Working Paper - 212 - Diversification and Sophistication of Livestock Products: the Case of African Countries

Africa has a sizable livestock population and almost each country produces livestock. The sector provides a large spectrum of benefits which include: cash income, food, manure, draft power and hauling services, savings and insurance, and social prestige (PicaCiamarra et al., 2014). Notwithstanding the importance of the livestock sector, Africa has not been able to transform its vast livestock potential into value added products that can generate higher income and well-paying jobs. Traditional herding is especially predominant and many livestock producers do not see this activity as a...

Working Paper - 213 - Disentangling the Pattern of Geographic Concentration in Tunisian Manufacturing Industries

“Markets favour some places over others, some places-cities, coastal areas, and connected countries are favoured by producers” (World Bank, 2009). The spatial agglomeration of economic activities may generate cooperative relationships and high levels of interaction between actors, as well as knowledge spillover. Economic behaviour is influenced not only by formal incentives and institutions, but also by the interaction between the various economic agents involved in the activity (Amara and Ayadi, 2009; 2013).

Working Paper - 214 - From Productivity to Exporting or Vice Versa Evidence from Tunisian Manufacturing Sector

Enhancing the competitiveness of a country's industry is a key issue for economic growth. A bulk of literature and several empirical analyses suggest that competitiveness is closely related to firms' efficiency, to innovation activity and to global engagement. Recent empirical research on the exporting behavior of firms has established several empirical regularities. Exporting firms are known to be superior in comparison to non-exporters in terms of productivity, capital intensity, wages, and size. The productivity premium of exporting firms has received particular attention from economists,...

Working Paper - 215 - A Regional Budget Development Allocation Formula for Tunisia

Inclusive growth which is both economic and social is crucial for Tunisia. It mainly requires high growth, an overall reduction of unemployment for young people in particular and the reduction of regional inequality through convergence. In fact, the objective of regional convergence, as a pillar of inclusive growth, is not only to allow redistribution from wealthy to poor regions in order to reduce regional inequality. It is also to consolidate the economic structure of the country and to contribute to a dynamic of growth and sustained regional convergence. In order to accomplish this,...