Economic Growth Performance and Labor Issues in Africa
Paper Session
Sunday, Jan. 9, 2022 10:00 AM - 12:00 PM (EST)
- Chair: Kwabena Gyimah-Brempong, National Science Foundation
Trade and Women’s Wage Employment: Is Africa Different?
Abstract
Many studies have documented the presence of gendered trade impacts in developed and developing countries. However, existing theoretical and empirical research contains mixed evidence on the effects of openness to trade on women’s employment, relative to their male counterparts. Moreover, most studies use female labor force participation as indicator of employment. This indicator may overstate women’s gains from greater openness to trade. This is particularly the case in sub-Saharan Africa (SSA), where a number of countries exhibit female labor force participation rates that are higher than those in developed countries, and where women tend to be over-represented in the informal sector. Consequently, it appears that focusing on women’s wage employment is potentially more appropriate. However, research using macro-level panel data to study the effects of trade on women’s wage employment, especially in Africa, remains lacking. The main contribution of this paper is to fill this gap. Using a large sample of macro-level World Bank data from developing and emerging economies and covering the period 1990-2018, this paper examines the impact of openness to international trade on women’s wage employment in the non-agricultural sector. The paper aims to ascertain whether the impact of trade on women’s wage employment is SSA is different from the impacts in other regions. Results from Fixed-effects and Arellano-Bond GMM estimates suggest that, indeed, greater openness to trade enhances women’s share of wage employment in SSA significantly more than in any other developing region in the world. We comment on the policy implications of these findings.Empirical Investigation into Economic Growth Episodes and Institutional Clusters in Africa
Abstract
The literature on the institution-growth nexus treats the influence of institutions on economic growth regardlessof the episodes of economic growth although it has long been recognized that the proximate cause of
low per capita income growth in Africa is the sequence of boom and bust. This study reorients the central
research question towards explaining the given-institution elasticity of growth episodes (e.g., acceleration
and deceleration). Notably, we attempt to re-evaluate the relationship between economic growth episodes
and clusters of institutions using a modified endogenous growth framework and a panel data of 42 African
countries covering the period 2005 to 2019 within the System-GMM approach. Growth acceleration and deceleration
episodes are identified using an improved variant of the filter developed by Hausmann, Pritchett,
and Rodrik (2005). One of the striking results indicates that the effects of institutions on economic performance
are asymmetric. Importantly, we also find that growth deceleration seems to be driven by a different
set of institutions than growth acceleration; meaning that the relative importance of specific institutions to
economic performance varies depending on episodes of economic growth. Another interesting finding is
the confirmation that institutions trump on other fundamental growth causes such as geography. Overall, we
interpret these results to suggest that weaker institutions and structural policies have a constraining effect on
economic growth as they indirectly affect countries’ potential to respond to low-growth challenges.
Revisiting Nonlinearities in the Quality of Economic Growth Story and the Age Dependency Impact in Africa
Abstract
Abstract: Over the last three decades (with the exceptions of the 2007-2008 worldwide financial meltdowns and the recent Covid-19 pandemic nightmare in 2020), African countries have experienced a robust average annual growth rate of over 5 percent. As impressive as this economic growth outcome has been, there is a renewed interest in assessing Africa's quality of such economic growth performance. For instance, economic growth in the fastest-growing African countries (South Africa, Ethiopia, Ghana, Kenya, Rwanda, and Tanzania) did neither result in an equitable distribution of income, nor tame poverty, high rate of unemployment, food insecurity, nor usher in democratic governance and participation in the economic growth dividend. In the spirit of Mlachila et al. (2014), we construct the Quality of Economic Growth Index for African countries over the 1995-2019 period. A dynamic panel threshold model with a kink is used to assess the nonlinear impact of the age dependency ratio on the observed quality of economic growth differences for African countries. Our analysis finds that an age dependency ratio threshold of 73.7%. The results indicate that while lower dependency ratios improve the quality of growth, higher dependency ratios are detrimental. We also find that openness to trade, the stock of foreign direct investment, and overall investments positively impact the quality of economic growth, whereas, inflation rate negatively impacts it.JEL Classification: O40, O55, I10, I20, I32
Key Words: Quality of Economic Growth Index, Dependency Ratio, Dynamic Panel Threshold, Kink, Africa, Dependency.
Discussant(s)
Linda Loubert
,
Morgan State University
Rhonda V. Sharpe
,
Women's Institute for Science, Equity and Race
Willene Johnson
,
Komaza, Inc.
Miesha Jamell Williams
,
Morehouse College
JEL Classifications
- O1 - Economic Development
- O4 - Economic Growth and Aggregate Productivity