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This paper examines the determinants of private tutoring in five major Middle East and North Africa (MENA) countries: Egypt, Algeria, Lebanon, Morocco, and Tunisia. The paper uses data extracted from the SAHWA Youth Survey (2016) and runs a probit model. The main findings indicate that age, receiving financial support, having educated parents and living in urban areas increase the demand for private tutoring. Conversely, the results show that being a male student or a child of an employed mother will decrease the need for a private tutor. The empirical findings propose potential policy implications for MENA countries facing the exacerbation of gaps in the education system while emphasizing the challenges hindering public schools from delivering quality education. [ABSTRACT FROM AUTHOR]

This paper analyzes the effects of informal finance on formal finance in West African Economic and Monetary Union (WAEMU) countries. To this end, it uses a Probit model with a binary endogenous regressor and data from the Global Findex database, 2021. The findings indicate that having already saved informally positively affects the behavior of individuals to save formally. They also indicate that informal financial credit positively affects formal financial credits in the WAEMU. These findings indicate that formal finance is complementary to informal finance in the WAEMU. On the other hand, the findings show that labour force participation, mobile banking use and online banking use increase the likelihood of use of formal and informal services in the WAEMU. This paper suggests that formal financial institutions (mainly banks and microfinance institutions) should strengthen their collaboration with actors (money keepers, itinerant bankers, tontines systems) involved in the provision of informal financial services to populations in order to improve formal financial intermediation in the WAEMU. [ABSTRACT FROM AUTHOR]

This paper examines the effect of competition on nonperforming loans in the Nigerian banking industry between 2011 and 2018 using the system generalized method of moments. The findings establish the competition‐stability hypothesis in the Nigerian context. The interaction between competition and bank size/capitalization has a positive and significant effect on nonperforming loans. These results showed that low competition increased nonperforming loans in the Nigerian banking industry while bank size and capitalization enhanced competition to increase nonperforming loans. Also, bank size/capitalization are complementary for addressing nonperforming loans. The paper recommends that the Central Bank of Nigeria (CBN) regulates the market power of the five largest banks in the industry to address the adverse effects of competition on mounting nonperforming loans in the Nigerian banking industry. [ABSTRACT FROM AUTHOR]

This paper investigates, for the first time, the uncertainty on the tourism of North Africa and uncertainty on the second‐degree effects of the North African tourism sector. The study uses data from 1995 to 2019 and a structural vector autoregression to perform the investigation. The research finds that uncertainties, measured by the uncertainty of Europe, the uncertainty of the Middle East and Central Asia, and the volatility of GDP growth of the Euro area, have significant negative effects on investment and job creation in, as well as the contribution to the GDP of, the North African tourism sector. The paper invents a new proxy of risk, measured by the volatility of crude oil production in North Africa, and finds that this new risk measure has a significant negative impact on the North African tourism sector. The results show that geopolitical risk and the uncertainty of Africa do not significantly affect the North African tourism sector. The paper suggests that policymakers in North Africa subsidize tourism‐related activities and explore new markets to attract tourists during periods of high risk and uncertainty. [ABSTRACT FROM AUTHOR]

The African Continental Free Trade Area (AfCFTA) has been hailed as a key pillar and catalyst for economic growth, industrialization, and sustainable development in Africa. One of the anticipated benefits is the promise to increase intra‐African trade through the elimination of import duties and other tariffs among countries. However, due to the heterogeneity between the African countries, questions remain as to whether each country will benefit from tariff elimination. This paper aims to evaluate the macroeconomic, fiscal, and welfare consequences of import tax removal in Senegal with the rest of Africa. We link an extended version of the partnership for economic policy (PEP) static computable general equilibrium (CGE) model with a non‐parametric microsimulation approach. We calibrate the model with Senegal's most recent Social Accounting Matrix. The microeconomic model is calibrated using the latest Senegalese household consumption survey. The findings indicate that tariff removal from the rest of Africa has favorable economic, fiscal, and welfare impacts for Senegal. The paper suggests that it will lead to an increase in economic growth and investment. The removal of tariffs is expected to favor urban households over rural ones and leads to a modest decrease in income inequality, accompanied by a 3.36% reduction in the number of poor. [ABSTRACT FROM AUTHOR]

It is against this background that the African Development Bank, in collaboration with the United Nations Development Programme and The United Nations Economic Commission for Africa, organized its 2021 African Economic Conference from 2 to 4 December 2022 in Cabo Verde to address the timely issue of post-COVID-19 development financing in Africa. At the time this paper was finalized (31 July 2022), close to 12 million COVID-19 cases had been reported in Africa (Figure 1), more than 225,000 people had died from the coronavirus (Figure 2) and the total number of active cases in Africa was about 500,000 (Figure 3). Since 2020, Africa and the entire world have experienced socioeconomic challenges of alarming proportions owing to the COVID-19 pandemic. Many policy responses and stimulus packages designed seem insufficient to address the negative effect of COVID-19, mostly when access to financing was very low and the lending gap very high prior to the COVID-19 outbreak. [Extracted from the article]

This paper investigates the impact of financial openness on financial sector development and income inequality. We use the de jure and de facto measures of financial openness across 78 countries from 1980 to 2019. By employing a system generalized method of moments (GMM) with 5‐year averaged data and a novel push and pull modeling framework, we obtain three key results. First, the de jure measure of financial openness exacerbates income inequality and is sensitive to banking crises and conflict intensity. Second, the de facto measure spurs stock value traded in emerging market economies (EMEs) and declines domestic credit in Africa. Third, the interaction between de facto measures with schooling and governance factors affects financial sector development and income inequality. We highlighted that the mere usage of the de jure measure and their interaction is incorrect. The key implication is that valuable information about the real impact of openness can be obtained from the de facto measures and their interaction with favorable macroeconomic fundamentals, governance factors, and adverse nonpolicy factors. [ABSTRACT FROM AUTHOR]

Countries across the world continue to invest in social protection programs with the goal of ending poverty by 2030. It is important to examine these programs to know whether they are serving the purpose of reducing poverty. In Rwanda, the impact of the Vision Umurenge Program (VUP) regarding poverty‐related outcomes has not been consistently revealed. This leads to uncertainty about the program's effectiveness in achieving the stated goals. This paper intends to fill this gap by estimating the impact of the VUP Direct Support on poverty outcomes. It uses the Propensity Score Matching method to compare the effects of the VUP with a counterfactual outcome. The findings show that the program is benefitting households in response to economic risks. However, the scheme is not lifting them above the national poverty lines. The main contribution of the paper is that it uses a novel method using the latest statistics to evaluate the VUP. In addition, it uses the most recent household data. The study provides a significant contribution to evaluation of the effectiveness of anti‐poverty interventions in Rwanda, as well as the Sub‐Saharan region, where the journey towards achieving the goal of reducing poverty is demanding. [ABSTRACT FROM AUTHOR]

To facilitate the introduction of a single currency in Economic Community of West African States (ECOWAS), the fiscal convergence criterion currently proposed by countries limits the public deficit to 3 per cent of GDP. According to the literature, the limitation of the public deficit to a given threshold is the most fundamental norm of the various convergence pacts existing and needed for monetary integration. Through a nonlinear panel data model, this paper tests the validity of the threshold by determining the public deficit threshold not to be exceeded so that fiscal policy has a positive effect on economic growth. Over the decade 2007–2016, this threshold is estimated at 4.74 per cent of GDP. Thus, the paper concludes that the proposed convergence criterion of 3 per cent of GDP is pro‐growth. However, in relation to the estimated threshold, there is a room for manoeuvre that can be used for supporting economic growth. Thus, the proposed threshold could be readjusted upward. The analysis also reveals that only four countries in ECOWAS are on the track to respect in the future, the proposed fiscal criterion and therefore are taking an important step toward the adoption of the future currency. The other countries need to make significant fiscal consolidation operations before hoping to adopt the single currency on the basis of fiscal discipline. [ABSTRACT FROM AUTHOR]

This paper seeks to evaluate efficiency and competition dynamics of the banking sector in Kenya for the period 2001–2017 using bank‐level data for 37 commercial banks. We apply non‐parametric data envelopment analysis to analyze measures of various aspects of efficiency in the banking sector. We also adopt Panzar–Rosse, H‐statistics to assess the level of competition in the banking sector. To examine the effect of efficiency on competition, panel estimators are applied. The study findings indicate that efficiency was on an upward trend and averaged 69%. The banking sector is characterized by monopolistic competition as shown by an H‐statistic of.59. Managerial ability measured by data envelopment analysis efficiency score was found to be an important factor in promoting competition for the Kenyan banking sector. The study shows that there is room for Kenyan banks to improve their efficiency by optimizing the scale of operations and continuing to adopt technology. This paper recommends policy makers to continue adopting policies that promote greater banking sector efficiency and competition. [ABSTRACT FROM AUTHOR]

This paper examines the trade–peace nexus in Africa and ascertains how poverty and inequality tilt the relationship in the eight regional (economic) blocs in Africa, viz. the Arab Maghreb Union (UMA), the Common Market for Eastern and Southern Africa (COMESA), the Community of Sahel–Saharan States (CEN–SAD), the East African Community (EAC), the Economic Community of Central African States (ECCAS), the Economic Community of West African States (ECOWAS), the Intergovernmental Authority on Development (IGAD) and the Southern African Development Community (SADC), from 1998 to 2020 using the Driscoll–Kraay estimate. The study contributes to the literature by disaggregating the peace effect of trade in Africa by the regional (economic) blocs to allow for in‐depth and context‐specific analysis. The paper also expands the scope of existing studies by examining the direct effect of poverty and inequality on peace in addition to the indirect effect that is revealed through their interactions with trade integrations. The findings reveal that trade promotes peace in Africa, while wide income inequality and a large poverty gap increase the likelihood of conflict. The interaction of poverty and inequality with trade integration shows that while the poverty level does not improve the effect of trade on peace, inequality reduces the impact of trade on peace. The study concludes that poverty and inequality play significant roles in the trade–peace nexus in Africa. Policy recommendations are discussed. [ABSTRACT FROM AUTHOR]

This paper examines whether technological innovations such as information and communication technology infrastructure, mobile phone subscriptions, secure internet servers and the number of automated teller machines and bank branches increased financial deepening in 43 African countries for the period 2010–2019. The study employs panel corrected standard errors, fixed effects and quantile regressions for empirical analysis. The results show that technological innovations have a positive and significant influence on financial deepening in Africa in terms of banks' mobilisation of deposits and allocation of credit to enterprises. Furthermore, the technological indicators have a strong and positive effect on higher levels of bank credit to the private sector than lower levels. As for bank deposits, only the number of branches was found to have significant and positive effects at a high level of bank deposits compared with a low level. These results imply that African governments and development partners can leverage ICT developments to increase financial deepening and reinvigorate debt financing, which is the primary funding source for small and medium‐size enterprises. [ABSTRACT FROM AUTHOR]

This paper examines the importance of good institutions in harnessing the growth effects of the bulging economically active population in sub‐Saharan Africa (SSA). The paper utilizes a panel dataset comprising 39 countries over the period 2002–13. Based on the system generalized method of moments estimator, this paper finds that an increase in the relative size of the working‐age population has no direct significant impact on growth, except through the presence of strong and high‐quality institutions. The paper also finds that control of corruption, rule of law and political stability are the specific aspects of institutions that matter the most in reaping the dividend. These results do not only highlight the primacy of strong institutions but also shed light on the key institutional pillars that need to be strengthened to rake in the positive effects of an increasing working age population on economic growth in SSA. [ABSTRACT FROM AUTHOR]

This paper examined the short‐ and long‐run impacts of gasoline price, macroeconomic factors and road length on road traffic crashes, injuries and fatalities in Nigeria. Annual data from 1995 to 2019 and autoregressive distributed lag approach were employed. Results suggest that gasoline price, per capita income, road length and population density significantly influence road safety outcomes. Gasoline price has a positive short‐run impact on crashes, injuries, and fatalities contrary to findings in developed countries. Road crashes tend to decrease when income increases in the short term. Population density leads to improvement in road safety outcomes while road length exacerbates it. Government's policy on gasoline price increase could worsen road safety outcomes unless it is accompanied by improvement in road infrastructure, safe public transport and economic growth, [ABSTRACT FROM AUTHOR]

This paper investigates the effect of financial development on domestic investment in West African countries. The study uses data from 1985 to 2019 and employs the pooled mean group technique. The main finding of the study is that financial development has a positive effect on domestic investment in the long run but an insignificant effect in the short run. Furthermore, remittances, real GDP per capita and trade openness increase investment rate. The results of causality tests support the view that investment is a channel through which financial development stimulates economic growth. Therefore, it is reasonable for the selected countries to formulate policies that promote domestic credit to the private sector in order to ease liquidity constraints and increase investment and economic growth. [ABSTRACT FROM AUTHOR]

This paper investigates the determinants of venture capital investments across 25 African countries over the period 2014–2019. In particular, it considers the significance of innovation and digitalization in Africa's venture capital activity. The results show that digital infrastructure, high‐technology exports, internet coverage, market size, minority investor protection and government effectiveness are the main drivers of venture capital deals in Africa over the period examined. More generally, these findings highlight that digital infrastructure and connectivity, innovation and institutional frameworks all play an important role in shaping a favorable environment to attract venture capital funding. [ABSTRACT FROM AUTHOR]

African countries generally cut corporate income tax (CIT) rates in the hopes of attracting foreign direct investment (FDI), whereas the effectiveness of tax rate reductions in attracting extractive industries FDI is controversial. This paper estimates the impact of the statutory CIT rate, as applied to mining companies, on FDI inflows to the gold and silver sectors of African economies. The estimation results indicate that the impact of the mining CIT rate on the host country's gold and silver FDI inflows is negative, but not statistically significant, at the conventional levels of significance. These results suggest that cuts in the CIT rate applied to mining companies will not necessarily attract FDI to gold and silver projects. Moreover, we find a strategic complementarity in gold and silver FDI inflows between countries, suggesting that an increase in the host country's gold and silver FDI inflows may stimulate FDI to gold and silver projects in neighbouring countries. Furthermore, the results show that infrastructure, government stability and gold and silver reserves positively affect gold and silver FDI inflows. The main findings of the paper suggest that, instead of granting corporate tax incentives, governments may consider improving the quality of socio‐economic infrastructure, the availability of geological information and promoting political and economic stability for attracting mining investments. [ABSTRACT FROM AUTHOR]

Investments in large‐scale land acquisition by foreigners, also referred to as land grabbing, are crucial to sub‐Saharan Africa's development. Land acquisition investments have attracted considerable attention in global development circles due to their potential positive (e.g., technology transfer, employment creation, infrastructure improvement, and global market integration) and negative (e.g., environmental degradation, food insecurity, displacement, and loss of livelihoods) impacts. The factors making land investments attractive to foreign investors are unclear. This paper examines country characteristics associated with land acquisitions in 20 sub‐Saharan African countries to provoke evidence‐based discussion. The paper estimates regression models of land acquisitions using country‐level data from 2010 to 2019 on demographic and economic conditions, natural resources, business practices and governance. The results reveal that the availability of land and water, corruption, days required to start a business, government effectiveness, cost of business startup and political stability are critical determinants of land acquisition investments in sub‐Saharan Africa. The paper recommends that African governments should: (1) strengthen regulatory frameworks on foreign direct investment in land; (2) scrutinize investors' business models, technical experience and knowledge of local culture; (3) undertake rigorous environmental and social impact assessments (ESIA) to weigh the long‐term cost‐benefits of LASLA projects; and (4) conduct transparent contract negotiations, taking political and economic power imbalances between parties into consideration. [ABSTRACT FROM AUTHOR]

The paper examines the effect of governance and health expenditure on infant mortality with a panel data of 32 sub‐Saharan African (SSA) countries from 2000 to 2015. Having accounted for potential endogeneity issues related to maternal choices that are made due to contemporaneous infant mortality, the evidence from system generalized method of moment reveals that health expenditure and governance shows no direct influence on infant mortality. However, the coefficient of the interaction between government effectiveness and health expenditure is significant and shows a negative relationship with infant mortality, implying that the effectiveness of health expenditure may be explained by the administrative capacity of countries in SSA. To validate our model, the result from the sensitivity analysis reveals that health expenditure and its interaction with government effectiveness and political stability/absence of violence exert a reducing effect on the under‐five mortality rate. Therefore, since governance quality is lower in SSA compared to other regions, we recommend that governance should be improved consistently in order to achieve health‐related outcomes. The findings further signal the urgent need to formulate policies that directly redress health conditions, rather than through indirect instruments. This focus is critical for the advancement of sustainable development goal 3 in SSA. [ABSTRACT FROM AUTHOR]

This paper employs the autoregressive distributed lag bound test and Nigerian time series data spanning 1980–2016 to provide empirical evidence on the educational financing—(youths) capacity development nexus via secondary school enrollment channel. The greatest factor that is pivotal to developing the capacity of Nigerian youths is investment in the quantity of education, and more significantly in its quality. The paper's main results show that budgetary allocation to education positively and significantly impacts secondary school enrollment, both in the long and short runs. Thererfore, the study recommends a substantial investment in the educational sector even if there has to be a trade‐off with other types of unproductive investment. [ABSTRACT FROM AUTHOR]

This paper studies the drivers of nonresident holdings of local currency debt in Nigeria. Using data over 2007M1–2019M1, we show that, on average, global factors (global interest rates, oil prices) seem to carry more weight than domestic factors (treasury bills rate and domestic risk) in foreign portfolio investors' decisions in Nigeria. Specifically, we show that foreign participation is, in the long run, positively correlated with oil prices and profitable rates of return on local‐currency instruments, but negatively correlated with exchange rate depreciation pressures. In the short run, oil prices, opportunity cost of funds and perception of Nigeria‐specific risks also play a role. These results highlight the volatile short‐term nature of such flows and call for a package of policy reforms to attract longer‐term direct investments. [ABSTRACT FROM AUTHOR]

The paper examines the role of education in reducing gender differentials in the Kenyan labor market. Using 2015/16 Kenya Integrated Household Budget Survey, we estimate the logit and multinomial logit model. The paper employs instrumental variable technique to correct for potential endogeneity that arises when analyzing education and labor market outcomes. The results from both models show that being a woman reduces the chances of entering the labor market. We find that education yields positive effects in the labor market. On average, the difference between the marginal effect of education on employment probability between men and women is two percentage points, with the effect being higher for women. In the multinomial logit model, educated women are more likely to be employed in both the public sector and the informal sector, while in the private sector they are less likely to be employed. The implication of these findings is that policies should target education as a tool that can reduce gender differential in the labor market. This should be coupled with affirmative action that gives priority to women and minimizes preference for men in the labor market. [ABSTRACT FROM AUTHOR]

This paper contributes to the literature in an attempt to understand the determinants of the informal economy by investigating the relationship between financial development and the size of the informal economy using an unbalanced panel data of 41 sub‐Saharan African (SSA) countries over the period 1991–2015. The paper applies different techniques such as ordinary least squares, fixed effects, system generalized method of moments, and quantile regression. The results show that financial development and its square are important determinants of the informal economy in SSA. Across a number of specifications, we find that financial development reduces the size of the informal economy and that there is a U‐shaped relationship between financial development and the informal economy. [ABSTRACT FROM AUTHOR]

This paper studies the effect of health care expenditure on health outcomes in sub‐Saharan Africa (SSA) using data from 1995 to 2018 for 45 countries. It uses fixed effects and generalized methods of moments estimation approaches for the analysis. The paper measures health care expenditure using three proxies: namely, total health care expenditure per capita, public health care expenditure to gross domestic product (GDP), and private health care expenditure to total health expenditure. Health outcomes are measured by child health outcomes (under‐5 mortality rate) and life expectancy. The results show that increase in health care expenditure as measured by total health care expenditure per capita and public health care expenditure to GDP leads to decline in under‐5 mortality rates. The results also show that total health care expenditure per capita leads to an increase in life expectancy. The study therefore recommends that governments in SSA increase budget allocations towards the health care sector to achieve better health outcomes. [ABSTRACT FROM AUTHOR]

This paper provides an empirical estimate of the effect that upgrading of roads along the two main transit routes in the East African Community (EAC) had on the total bilateral trade costs facing manufacturing industries. The transit routes are the Northern Corridor and the Central Corridor, which link the capital cities of Burundi, Kenya, Rwanda, Tanzania, and Uganda to the seaports of Mombasa in Kenya and Dar es Salaam in Tanzania. This paper exploits information on the condition of roads along these routes, which is published by government and donor agencies. The reports pertain to road projects that were completed in the period 2004–2010, and indicate that the share of paved roads in good condition along the Corridors doubled between 2003 and 2010. This study estimates that the increase in the quality of transit roads lowered both domestic and cross‐border trade costs, and that the latter effect is larger than the former. The study also finds that the increase in trade volumes due to better transit roads is attributable to industries producing output with above median weight. These industries dominate the EAC manufacturing sector, suggesting that a compositional change in cross‐border trade flows arising from better transit roads is unlikely. [ABSTRACT FROM AUTHOR]

This paper examined the effects of the financial liberalization strategy adopted on the African continent over 25 years ago in promoting new business entry using data from 22 sub‐Saharan African (SSA) countries in 2006–2017. Results from the dynamic generalized method of moments models show that: financial development via a policy of financial liberalization does not have a uniform effect on entrepreneurship; the interest rate gap significantly undermines the entrance of new firms; the ratio of broad money/gross domestic product (GDP) was positive and statistically significant while real interest rate had mixed findings; interactive effects of interest rate spread and real interest rate with regulatory quality was negative; the interaction of interest rate spread and real interest rate with natural resources confirms its destabilizing effect, although there was evidence suggesting that natural resources do not directly undermine entrepreneurship growth. Other results show real GDP and private credit have a significantly positive effect, and the cost of getting electricity significantly undermines entrepreneurship. The study calls for the need to deepen the financial sector though targeted reforms across SSA countries to reap its growth‐inducing effects on economic outcomes, while promoting institutional quality and efficient use of natural resources to achieve a non‐declining infusion of SMEs on the continent. [ABSTRACT FROM AUTHOR]

This paper seeks to establish the contribution of the Common Market for Eastern and Southern Africa (COMESA) programmes in promoting industrialization. It further seeks to establish the link between industrialization and productivity. The paper uses a gravity model to estimate a cross‐sectional time‐series (panel) dataset for the period 2001–2015. The results indicate that membership to COMESA has created large markets and promoted industrialization among member states. However, results also confirm that COMESA member states still heavily trade in industrial intermediates with non‐members. The study further reveals that the share of foreign total factor productivity (TFP) to COMESA's TFP are weaker than expected, which suggests non‐convergence to international knowledge spillovers. The study concludes that COMESA programmes have positively affected industrialization. We therefore recommend that COMESA should continue implementing strategies, policies and programmes that promote industrialization and technology transfer. [ABSTRACT FROM AUTHOR]

This paper analyzes factors that drive foreign direct investment (FDI) in Africa. To do so, for the first time in the literature, the paper uses 5-year panel data and the system-GMM technique over the period 1970-2009. The main results are as follows: (a) larger countries attract more FDI; (b) regardless of their size, however, more open countries, politically stable countries, and countries offering higher return to investment also attract FDI; (c) FDI inflows are persistent in Africa. This suggests that countries that manage to attract FDI today are likely to attract more FDI in the future. [ABSTRACT FROM AUTHOR]

Abstract: Based on the Salter‐Swan‐Corden‐Dornbusch framework, which argues that capital inflows may appreciate the official exchange rate by aggravating the effects of any previously existing domestic distortions, this paper examines the claim that workers’ remittances cause the Dutch disease in sub‐Saharan Africa (SSA). Specifically, the study investigates whether remittances cause financial overheating and spending effects. The study adopts the dynamic panel instrumental variable system generalized method of moment (IVSGMM). This study finds that although workers’ remittances cause financial overheating, they neither increase general spending nor appreciate the real exchange rate, thereby implying that workers’ remittances do not cause the Dutch disease in SSA from 1996 to 2013. These findings suggest that governments should establish diaspora incentive schemes so as to encourage remitters and recipient households’ to invest productively. Government efforts should be integral at improving the financial education for remitters and the recipient households so as to avoiding channelling overheating effects to spending effects and to the Dutch disease. [ABSTRACT FROM AUTHOR]

Abstract: This paper seeks to understand if education can be an effective tool in achieving gender equality in labour force participation in Cameroon. For this purpose, the multinomial and binary logit models are estimated. The paper accounts for the potential endogeneity of education in the equation of labour force participation by using the instrumental variables approach. Data used are data on employment and the informal sector obtained from the National Institute of Statistics in Cameroon. The findings shed light on the negative impact of being a woman on the probability of getting a job. They also show that education and the interaction term between gender and education has a positive and statistically significant impact on the probability of working in the public and the formal private sectors. These results suggest that education yields a premium skill which offsets the negative effect of being a woman. [ABSTRACT FROM AUTHOR]

In sub-Saharan Africa (SSA), competitive elections can cause considerable violence and widespread destruction of property, most of which is ethnically motivated. Recent literature shows that ethnic identification is more prominent during competitive election periods in comparison to other identifying categories such as gender, religion, and class/occupation. This paper utilizes data from 12 SSA countries and over 40,000 respondents taken from the Afrobarometer. It asks if individual perceived living conditions changes in the run-up to competitive elections. Strong evidence shows that a perceived living condition does change. It is positively related to the proximity to an election and this proximity effect depends on the competitiveness of the election. The paper further investigates the background mechanisms behind this positive relationship, that is, to what extent does living conditions of the individual change if the party that the individual supports wins the election and is there a change in living conditions of the individual before and after the election? In addition, this paper documents that ethnic identification also has a positive impact on individual perceived living conditions after controlling for electoral cycle variables. [ABSTRACT FROM AUTHOR]

Rural entrepreneurship is an important employment generation intervention for the fast‐growing young labour force in developing countries. Many bottlenecks including access to finance impede rural youths from performing in their new ventures. This paper examines the impact of access to finance on rural youths' entrepreneurship in Benin using data from the second wave of the School‐To‐Work Transition Survey, involving over 900 youths. The paper employs the endogenous switching regression technique, combined with propensity score matching, to investigate the drivers of rural youths' access to finance and its impact on entrepreneurship intention and performance. The results indicate that age, education, poverty status, experience, working in the agricultural sector and the existence of a bank branch are important determinants of rural youths' access to finance. The results also show that access to finance increases the probability of youth entrepreneurship by 15.2% on average. Moreover, the study shows a significant gender gap in rural entrepreneurship of 5.24% among youths with access to finance in Benin. These results suggest that policymakers should facilitate the access of youth, especially young women, to finance by encouraging formal financial institutions to reduce their credit eligibility conditions for those who do not have collateral. [ABSTRACT FROM AUTHOR]

This paper investigates whether and how aid targeted at specific sub‐categories of economic infrastructure could assist the economies of 14 Economic Community of West African States to attract higher foreign direct investment (FDI) inflow via improvement in infrastructure in water supply and sanitation, energy, transport and ICT. By relying on the three stage least squares estimation technique that is able to account for endogeneity among structural equations, and utilizing data spanning 2005–2018, we found quite interesting results. First, aid targeted at infrastructure indicates a strong positive effect on the countries' infrastructure endowment. Second, there is robust evidence that aid promotes FDI, but not necessarily through the infrastructure channel. Targeted aid appears to exert a positive and direct knock‐on effect on FDI—apparently, because investors anticipate the positive effect that targeted aid is almost always inclined to produce on host countries' infrastructure endowment. Finally, aid allocation by Development Assistance Committee donors seems to have been primarily merit‐based, followed by weaker evidence for "need". The study recommends, inter alia, more need‐based aid allocation, particularly in economies where initial infrastructure endowment is minimal. [ABSTRACT FROM AUTHOR]

The lack of resources is often highlighted as the most important correlate of poor learning outcomes in developing countries. However, increasing school resources may not necessarily drive better learning if resources are not properly translated into learning outcomes. This paper investigates the efficient utilization of school resources to promote learning. It tries to better understand the extent to which efficiency plays a role in the relationship between school resources and learning outcomes. Applying the Data Envelopment Analysis methodology, an efficiency analysis is performed using the PASEC 2014 learning assessment that covers 10 francophone West and Central African countries. The results show that the efficiency of school resource utilization varies across countries and across schools within the same countries. The relationship between some of the key elements of school resources and learning is weak in the least efficient schools. This suggests that resources allocated to the least efficient schools should consider first addressing inefficiency issues. While efficiency drivers may vary depending on the country's specific contexts, findings show that student absenteeism, community engagement in school management, teaching time and school environment seem to play a role in school efficiency. [ABSTRACT FROM AUTHOR]

Using data for 22 sub‐Saharan African (SSA) countries, this paper investigates the effects of public debt on economic growth in SSA countries covering the period 1990–2021. Relying upon the estimation of Panel Smooth Transition Regression and generalized method of moments method, our findings offer strong evidence that public debt nonlinearly impacts economic growth. More specifically, there exists a threshold beyond which public debt exerts a negative effect on growth. These results can be used to formulate economic recommendations that the public authorities could implement to improve public debt management and maintain stable economic growth. [ABSTRACT FROM AUTHOR]

Empirical evidence on the benefits of international ownership for small and medium‐sized enterprises (SMEs) financial performance is either not available for most African and Middle Eastern countries or presents mixed results. In this paper, we investigate this further by examining the effects of ownership structure on firm performance, using financial data covering SMEs in 60 African and Middle Eastern countries, for the years 2006–2015. Results from pooled ordinary least squares and random‐effects estimations indicate that international ownership is significantly positively correlated with firm performance for (most of) Africa and the Middle East. Examining the interaction of international ownership with capital resources, we find that internationally owned firms do not use capital more efficiently than locally owned firms, implying that internationally owned firms use international resources—other than capital—more efficiently. [ABSTRACT FROM AUTHOR]

This paper calculates the trade efficiency of China's exports to Africa by considering trade inefficiency factors, such as Chinese aid to Africa and Chinese contracted projects. Based on a stochastic frontier gravity model and data for China's exports to 38 African countries from 2010 to 2020, this study draws the following conclusions. First, trade inefficiencies, such as China's aid and contracted projects, play a positive role in promoting China's export trade to Africa. Second, the efficiency of China's export trade to Africa varies significantly in different regions, among which countries with high export trade efficiency are concentrated in North and South Africa. Third, the trade potential and trade expansion space of China's exports to Africa vary significantly among different product sectors, which provides much space for promoting trade policy. We highlight that China's government should develop differentiated regional trade policies due to regional heterogeneity in terms of export trade efficiency between China and African countries. [ABSTRACT FROM AUTHOR]

This paper explores the influence of corporate governance on the profitability and credit risk of a sample of listed banks in Tunisia. The methodology involves two main steps. Firstly, principal component analysis is employed to construct a novel governance index, assessing the quality of both internal and external bank governance. This index takes into account the degree of compliance and application of directives and laws mandated by the Tunisian Central Bank regarding banking governance. In the second step, panel data analysis is conducted to scrutinize the impact of internal and external governance mechanisms on the profitability and risk of Tunisian banks. The results reveal that as the governance index increases, the profitability of banks improves in terms of return on assets and stock market performance. Additionally, a higher governance index is correlated with a reduction in credit risks, as indicated by lower instances of non‐performing loans and an increased rate of coverage for classified debts. To enhance the robustness of our results, we calculate a standard governance score based on existing empirical literature. Furthermore, to account for potential endogeneity, we employ the two‐step system generalized method of moments. [ABSTRACT FROM AUTHOR]

This paper investigates the effects of institutional quality on tax revenue collection in sub‐Saharan African countries. We include the six institutional quality indicators (i.e., voice and accountability, political stability, regulatory quality, rule of law, control of corruption, and government effectiveness) as explanatory factors for tax revenues and its components in a sample of 42 countries over the period 1996–2019. A system GMM approach was used for the estimations. Consistent with previous results, we find that institutional quality has positive and significant effects on tax revenue collection in sub‐Saharan Africa. Specifically, aggregate total tax revenues, direct taxes, income taxes, and goods and services taxes are positively affected by the six institutional quality indicators. Indirect taxes are positively associated with four indicators, with the exception of government effectiveness and political stability, while tax on international trade are affected by institutional quality factors, with the exception of control of corruption and voice and accountability. These findings indicate that sub‐Saharan African countries should improve institutional quality to boost tax revenue collection. [ABSTRACT FROM AUTHOR]

The paper aims to investigate the legitimacy of the African Union by examining the socio‐demographic determinants of citizens' support of African integration. To do this, we use Rounds 4, 5, 6, and 8 of the Afrobarometer survey data corresponding to more than 110,000 respondents. Using logistics regressions, we find that individual characteristics such as living area, education, employment status, political membership, freedom, living conditions, and Living Poverty Index (LPI) are significantly related to the probability of supporting African integration. The findings are largely robust to dynamics of regional integration, the African Union, and Regional Economic Communities (RECs). Thus, since African citizens' trust in the unification could be considered a condition of legitimacy in the process, our results suggest that more efforts should be made to gain credibility, especially as it pertains to the benefits of African integration. [ABSTRACT FROM AUTHOR]

With the increasing education of women in developing countries, educational assortative mating has become a significant aspect in the marriage market, with educational assortative mating patterns likely to be dependent on marriage timing. Using pooled data from three recent waves of the Cameroon Demographic and Health Surveys, the paper investigates the effect of marriage timing on educational assortative mating patterns in Cameroon. To achieve the objective, the study employed the Cox proportional hazard model and a control function version of multinomial Probit. Results show that delaying marriage is expected to decrease the likelihood of women engaging in low educationally homogamous marriages while increasing the probability of women entering high educationally homogamous and hypogamous marriages. Findings further depicted that over the period 2004–2018, the likelihood of women engaging in low educationally homogamous marriages decreased meanwhile the likelihood of women considering high educationally homogamous marriages and hypogamous marriages increased. The implications of these findings are in tandem with the wisdom that, programs encouraging the girl child to delay early marriages and stay longer in school can help women engage in high educationally homogamous marriages, empower women and thus improves their socioeconomic status. [ABSTRACT FROM AUTHOR]

This paper examines the asymmetric link between carbon pricing and the comparative advantage in environmental goods exports in South Africa from 1995 to 2021. The non‐linear autoregressive distributed lag model is utilized to investigate the effects of both minor and major positive and negative fluctuations in carbon taxes, technological innovation, and energy transition on comparative advantage. The results reveal that carbon taxes have an asymmetric effect on comparative advantage in both the short and long runs, with positive shocks exerting a greater beneficial influence than negative shocks. Specifically, it is found that a 1% reduction in carbon taxes corresponds to a 1.24% decline in the response variable, whereas a 1% increase in carbon taxes is associated with a 2.72% increase in comparative advantage in environmental goods exports, which is twice as large. The study also uncovers evidence of an asymmetric relationship between low‐carbon technological innovation and comparative advantage in environmental goods exports. However, strong evidence of a long‐run asymmetric linkage between the energy transition and comparative advantage is not established. Nevertheless, it is noteworthy that a positive shift in energy transition is linked with a 0.32% rise in comparative advantage in environmental goods exports, whereas a negative shift in energy transition corresponds to a 0.11% decrease. The practical policy implications are also discussed. [ABSTRACT FROM AUTHOR]

Following a global vector autoregressive (GVAR) approach, this paper presents new evidence on the validity of international transmission of economic shocks from key trading partners as sources of macroeconomic fluctuations in sub‐Saharan African (SSA) countries. The GVAR model was estimated for 21 SSA countries grouped into three country classes—oil‐rich, other‐resources‐rich and non‐resource‐based economies, to account for output shocks from crucial trading partner countries—United States, United Kingdom, China and Europe. Furthermore, the generalized forecast error variance decompositions results reveal that output shocks from key trading partners constitute significant contributors to changes in key macroeconomic indicators—real gross domestic product, inflation, exchange rate and short‐term interest rate, in the SSA region. The generalized impulse response functions indicate that these economic shocks have more significant impacts on oil‐rich countries than on other country groups. A key recommendation from this study is that SSA countries, especially the resource‐rich economies, need to strengthen and diversify their economic structure, including the trade basket. [ABSTRACT FROM AUTHOR]

This paper investigates the direct and combined impacts of trade facilitation and information and communication technology (ICT) on bilateral flows of 25 sub‐Saharan countries. For that purpose, we select time to export and import as specific trade facilitation indicators and broadband use to study ICT impacts. Our sample covers a total of 93 countries over the period 2004–2018. By preprocessing data analysis, we impute time costs missing values, an essential shortcoming of the available databases, to study trade facilitation over time. Lastly, we employ a gravity model and implement a Bonus Vetus Estimation. Our results show that broadband use exerts a positive and significant effect on trade, especially relevant for intra‐African trade flows. Furthermore, the combined effects indicate that broadband also modulates the negative impacts of time to export and time to import in the case of intra‐SSA countries' trade. The more significant result is found for time to export. Our results also confirm that time costs are not only particularly harmful to intra‐African trade but also negatively impact trade flows from SSA countries to the rest of the world. These outcomes show the importance of coordinating trade facilitation and digital transformation policies, particularly those devoted to digitally transforming African customs. [ABSTRACT FROM AUTHOR]

The purpose of this paper is to evaluate the relative influence of bilateral and multilateral concessional debts on public investment in 32 sub‐Saharan African countries over the period 1985–2020. Dynamic panel autoregressive distributed lag models comprising the mean group, pooled mean group and dynamic fixed effect estimators were employed in our model estimations. The results revealed that bilateral and multilateral concessional debts had a long‐run positive and significant effect on public investment. The findings indicated that a 1% change in bilateral and multilateral concessional debt was associated with 8.6 and 11.3% increases in public investment, respectively. While the short‐run influence of bilateral concessional debts was significantly positive, multilateral concessional debts had a short‐run positive but insignificant effect on public investment. It is discovered that institutional quality is associated with declines in public investment. The contingency analysis shows that institutional quality explains a lot about how well bilateral and multilateral concessional debts drive public investment. The evidence suggests that poor institutional quality is more likely to undermine the effectiveness of bilateral concessional debts on productive investment than multilateral concessional debts. [ABSTRACT FROM AUTHOR]

Financial inclusion remains at the heart of governments concerns. By creating favorable conditions for access to a diversified range of adapted financial products and services at affordable costs for the populations, financial inclusion generates important opportunities that could lead to increased tax revenue mobilization. This paper analyzes the effects of financial inclusion on tax revenue mobilization, using panel data from West African Economic and Monetary Union (WAEMU) countries over the period 2006–2019. The findings suggest that financial inclusion positively and significantly influences government's tax revenue. Moreover, by looking at the effects of disaggregated financial inclusion dimensions (access, use, and affordability) on various components of tax revenue, we find that the estimated coefficients on the subcomponents of financial inclusion are statistically significant. Results also indicate that the magnitude of effect of financial inclusion is higher on indirect taxes compared to direct tax revenues. This research recommends that policy‐makers should prioritize financial inclusion in their policies and development agenda through National Financial Inclusion Strategies (NFIS) because it can increase countries' resource mobilization and help them to build fiscal resilience. [ABSTRACT FROM AUTHOR]

The Old Age Pension (OAP) to elderly South Africans is one of the biggest programs in developing countries. It's a vital income source to many households because it puts a significant cash transfer into the hands of many poor households, and the sharp increase in its take‐up at the minimum eligibility age further demonstrates its importance. This paper estimates the OAP's impact on households' food security, quality of water and sanitation facilities, where the last two are essential public health‐related outcomes. We find that the OAP has a significant and positive impact on food security, but not on the quality of drinking water and sanitation. We attribute the latter to the high fixed costs associated with access to quality drinking water and proper sanitation services and their nature as a form of public good. The paper further attempts to understand whether gender influences these outcomes. [ABSTRACT FROM AUTHOR]

Catastrophic healthcare expenditure (CHE) can plunge households into poverty. Faced with CHE, the question that becomes relevant is how long it will take the household to exit CHE. This paper examines the effect of the Ghana National Health Insurance Scheme (NHIS) on exit time from CHE. The paper uses the Cox proportional hazard model for the analysis, with data sourced from round six of the Ghana Living Standard Survey and World Development Indicators. The results show that households that spend 40% (20%) of their non‐food incomes on healthcare, on average, exit CHE after 10 months and 4 days (13 months and 24 days) being in CHE and those with NHIS coverage exit CHE 19 days (30 days) earlier than those without NHIS coverage. Policy implications arising from this paper include the need to expand NHIS enrolment to mitigate impoverishment due to out‐of‐pocket healthcare payments. Households with higher risks of severe CHE and longer exit time from CHE should be identified and provided with comprehensive NHIS coverage than those with lower risks. [ABSTRACT FROM AUTHOR]

A growing body of literature highlights the importance of export sophistication for economic development. Given the newness of the literature on export sophistication, its determinants are under‐exploited. As a pioneer study, this paper attempts to fill this gap in the literature by examining the effect of infrastructure development on export sophistication. Based on a panel of 45 African countries over the period 2003–2016, the results of the different estimations show that infrastructure, including transport, electricity, ICT and access to water and sanitation, improves export sophistication in Africa. Our results also show that the effect of infrastructure varies at different intervals of the export sophistication distribution. Therefore, improved infrastructure would allow African countries to not only improve their export structure but also achieve sustainable and durable growth. [ABSTRACT FROM AUTHOR]

This paper highlights the existence of a nonlinear relationship between bank stability and competition and analyzes the role that government intervention plays in shaping this relationship. We used a sample of 45 banks in North African countries over the period 2005–2019. We applied a semiparametric approach based on penalized spline estimation. The results unveil the specific shape of the competition–stability relationship at different levels of competition; banks reconsider their risk‐taking behavior at each level of competition. This nonmonotonic stability at different levels of competition is attributed to the quality of intervention, which is found to be an important determinant in shaping this relationship. Thus, we explain the dispersion of risk levels among North African banks in part by the quality of regulation in each country and conclude by recommending the strengthening of regulation, supervision and the macro‐prudential framework. [ABSTRACT FROM AUTHOR]