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Working Paper 307 - The Macroeconomics of State Fragility in Africa


Despite significant progress in the past two decades, sub-Saharan African economies have lagged behind other regions on almost any real measure of macroeconomic performance. At the same time, sub-Saharan African countries dominate the top 50 percentile of rankings on almost all indicators of state fragility. Could it be that Africa’s predominantly fragile situation is primarily responsible for its broad poor macroeconomic performance? Maybe. But such a proposition would be contentious, especially in the light of the tenaciously propagated views of the Washington Consensus, which argues that macroeconomic outcomes in developing economies are mainly determined by macroeconomic policies (see Williamson, 2000; Stiglitz, 2005). Although, admittedly, the empirical connection between macroeconomic policies and macroeconomic performance is somewhat established (see Easterly, 2005; Collier & Gunning, 1999), there remain ambiguities about the underlying drivers of this relationship. Two important questions emerge: Are poor macroeconomic outcomes the result of not only, or not even primarily, economic factors but rather of deep underlying state fragility problems? What are the mechanisms by which state fragility affects macroeconomic outcomes in sub-Saharan Africa?

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