Bigger or better? The effect of public spending on happiness in Africa

Following the rising wave of terrorism in Africa, particularly in the last decade, this study investigated the effect of terrorism on economic complexity in the region as well as the moderating role of military expenditure in the terrorism–economic complexity relationship. A panel of 34 African economies was used over the period 2010–2021. The study also used the dynamic system generalized method of moments framework. We find that the unconditional effect of terrorism on economic complexity in Africa is predominantly negative and significant, and that military expenditure in the region has been ineffective in moderating this adverse effect. This finding remained robust regardless of whether terrorism is measured by the number of terrorism incidents, fatalities, injuries, or hostages. However, our results showed that industrialization, urbanization, and governance institutional quality are potent channels for promoting economic complexity in Africa. Among others, the study emphasized the need for policymakers and leaders in Africa to collaborate at the level of the African Union to address the detrimental effects of terrorism on the continent.

Section: Literature Reviewmentioning

confidence: 99%

Terrorism and economic complexity in Africa: The unconditional impact of military expenditure

Emeka,

Ogbuabor,

Ekeocha

2024

“…

{X}_{i,t}

est une matrice de variables de contrôle, sélectionnées sur la base de littérature sur les déterminants de la croissance. Ces variables comprennent, notamment l'investissement, l'ouverture commerciale, le capital humain, la population, les indices de stabilité politique, de contrôle de la corruption et du terrorisme (Becker et al, 1999; Bayale, 2018; Bayale, Traoré, Diarra, et al, 2022; Dunne et al, 2005; Fambeu et al, 2022; Fan & Zhang, 2008; Hanushek & Woessmann, 2010; Papagni el al., 2021; Rodríguez & Rodrik, 2000; Rodrik, 2008; Sala‐I‐Martin, 1996).…”

Section: Méthodologie Et Donné De L'étudeunclassified

Dépenses militaires et croissance économique dans l'UEMOA: une analyse des effets de seuil et des canaux de transmission

Bayale,

Gado,

Sambieni

et al. 2024

RésuméCet article détermine, à travers une approche non linéaire, le seuil de dépenses militaires compatible avec l'objectif de croissance économique. En appliquant un modèle de seuil endogène sur les données en panel des huit pays membres de l'UEMOA, sur la période 1995–2019, les estimations mettent en évidence l'existence d'un seuil de dépenses militaires estimé à 2,48% du PIB dans l'Union. Elles indiquent également que lorsque les dépenses militaires sont à un niveau inférieur à ce seuil, leur effet sur la croissance des États de l'Union est positif et significatif. En revanche, les valeurs supérieures à ce seuil n'apparaissent pas favorables à la croissance économique dans l'UEMOA. En outre, l'étude a identifié deux principaux canaux de transmission des dépenses militaires à la croissance économique dans ces pays, à savoir le capital humain et la stabilité politique. A cet égard, les pays de l'UEMOA devraient limiter les dépenses de défense et de sécurité à 2,48% du PIB au maximum, sauf si le niveau de l'insécurité justifie le dépassement de ce seuil.

“…The study found that the impact of public debt on economic growth is moderated by the quality of the institutions and the proportion of productive expenditure. Fambeu et al (2022) studied the effect of government spending on happiness in 39 African countries from 2006 to 2018. They found that public spending positively affects happiness in the poorest countries of Africa.…”

Section: Review Of Literaturementioning

confidence: 99%

“…One major issue that is attracting the attention of scholars and policymakers globally, and in sub‐Saharan African (SSA) countries, in particular, is the rapid increase in the level of public debts over the last few decades (Akram, 2016; Beqiraj et al, 2018; Carner et al, 2021; Fambeu et al, 2022; Kassouri et al, 2021; Law et al, 2021; Makun, 2021; Napo, 2022; Olaoye, 2022a, 2022b; Owusu‐Nantwi & Erickson, 2016; Sennoga & Balma, 2022; Wang et al, 2021). In the last two decades, the total public debt for SSA increased from an average of 27% of gross domestic product (GDP) in 2010 to over 56% in 2018.…”

Section: Introductionmentioning

confidence: 99%

Macroeconomic implications of escalating stock of public debt: Evidence from sub‐Saharan African economies

Olaoye¹,

Tabash

Omokanmi³

et al. 2022

The study investigated the effect of public debts on macroeconomic indicators, such as inflation and the exchange rate, using a panel of 25 sub-Saharan African (SSA) economies. The study contributed to extant studies by looking at the separate effect of domestic and foreign debts on inflation and exchange rate. We adopted a battery of econometric tools such as the Driscoll-Kraay standard errors and the dynamic panel threshold model. The results show that foreign debts worsen the inflation rate and expose the economy to unanticipated movements in the exchange rate, whereas domestic debts help to reduce the inflationary pressure. The study also found a nonlinear relationship between public debts and macroeconomic indicators of inflation and exchange rates. This implies the further accumulation of foreign debt will heighten the inflation rate and expose the region to unanticipated movements in the exchange rate. The study recommends that governments and policymakers in SSA should ensure that foreign debts are sufficiently hedged against currency and interest rate risks to reduce the exposure of SSA economies to exchange rate risks. The study also recommends that governments adhere strictly to the maximum debt limit of 60.59% (of gross domestic product), otherwise inflation and exchange rates may worsen.domestic debts, exchange rate, foreign debts, inflation, public debt | INTRODUCTIONOne major issue that is attracting the attention of scholars and policymakers globally, and in sub-Saharan African (SSA) countries, in particular, is the rapid increase in the level of public debts over the last few decades (Akram, 2016;