The Impact of Governance on Economic Growth in Africa

Fayissa, Bichaka; Nsiah, Christian

doi:10.1353/jda.2013.0009

Cited by 131 publications

(103 citation statements)

References 43 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…Conversely, the positive effects of other governance dynamics are also consistent with some findings in the engaged literature: Yerrabit and Hawkes (2015) for government effectiveness, regulation quality, and economic governance; and Yerrabit and Hawkes (2015) and Gani () for corruption‐control. Moreover, I have confirmed the positive impact of general governance that has been documented in the literature without empirical validity (Cooray ; Fayissa and Nsiah ; Kaufmann, Kraay, and Mastruzzi , ; Siddiquia and Ahmedb ; Yerrabit and Hawkes 2015). Accordingly, conclusions on the positive role of general governance have been based on generalized inferences that are not backed by statistical evidence, since governance dynamics have not been previously bundled.…”

Section: Resultssupporting

confidence: 72%

“…Cooray () has investigated the nexus between governance and economic growth in 71 countries to establish that government quality and size are important determinants of economic growth. Fayissa and Nsiah () have assessed the effect of governance in “sub‐optimal economic growth” performance in Africa using the generalized method of moments (GMM) and, FE and RE regressions. Corresponding findings show that governance positively influences economic growth, with the effect contingent on income levels.…”

Section: Growth and Governancementioning

confidence: 99%

See 1 more Smart Citation

Determinants of Growth in Fast‐Developing Countries: Evidence from Bundling and Unbundling Institutions

Asongu

2016

Politics & Policy

View full text Add to dashboard Cite

Purpose -We assess growth determinants in the BRICS (Brazil, Russia, India, China and South Africa) and MINT (Mexico, Indonesia, Nigeria and Turkey) fast-developing nations for the period [2001][2002][2003][2004][2005][2006][2007][2008][2009][2010][2011]. Particular emphasis is laid on the bundling and unbundling of ten governance dynamics.Design/methodology/approach-Contemporary and non-contemporary Fixed-and RandomEffects regressions are employed as empirical strategies. GDP growth and real GDP output are used as dependent variables. The governance variables are bundled by means of principal component analysis. Findings-The following are some findings. First, governance is more positively significant in non-contemporary specifications as opposed to contemporary regressions. Second, there is some interesting evidence on the heterogeneity of political governance as a driver. Political governance and its constituents (political stability and voice & accountability) are significantly positive in GDP growth but insignificant in real GDP output regressions. Third, the other governance dynamics are more significant determinants of real GDP output, as opposed to GDP growth. Accordingly, they are insignificant in contemporary regressions and negatively significant in non-contemporary regressions for GDP growth. Fourth, the constituents of economic governance have the highest magnitude in the positive effects of governance dynamics on real GDP output. Practical implications-The following are some practical implications. First, lag determinants are necessary for growth targeting or timing of growth dynamics. Growth drivers for the most part are more significantly determined by past information. Second, political governance is the most important driver of economic growth, with the significance of effects more apparent in non-contemporary regressions. Third, economic governance and institutional governance are more positively predisposed to driving real GDP output than GDP growth.Originality/value-As far as we have reviewed, it is the first study to investigate growth determinants in the BRICS and MINT nations. It has strong implications for other developing countries on the contemporary and non-contemporary dynamics of governance in driving economic prosperity.1 Simplice A. Asongu is Lead economist in the Research Department of the AGDI (asongus@afridev.org). 3JEL Classification: C52; F21; F23; O40 ; P37 Keywords: Economic Growth; emerging countries; governance AcknowledgementWe are highly indebted to Akpan Uduak for sharing his dataset.

show abstract

Section: Resultssupporting

confidence: 72%

Section: Growth and Governancementioning

confidence: 99%

Determinants of Growth in Fast‐Developing Countries: Evidence from Bundling and Unbundling Institutions

Asongu

2016

Politics & Policy

View full text Add to dashboard Cite

show abstract

“…Further evidence of the effects of governance on economic growth for African countries is in Fayissa and Nsiah (2010). Here governance, measured by the six world governance indicators, implies good governance, and good governance goes hand-in-hand with good institutions as economic growth drivers.…”

mentioning

confidence: 99%

Globalization, Peace & Stability, Governance, and Knowledge Economy

Amavilah¹,

Asongu

Andrés

2014

SSRN Journal

View full text Add to dashboard Cite

A previous analysis of the impact of formal institutions on the knowledge economy of 22 MiddleEastern and Sub-Sahara African countries during the 1996-2010 time period concluded that formal institutions were necessary, but inadequate, determinants of the knowledge economy. To extend that study, this paper claims that globalization induces peace and stability, which affects governance and through governance the knowledge economy. The claim addresses one weakness of previous research that did not consider the effects on the knowledge economy of globalization.We model the proposition as a three-stage process in four hypotheses, and estimate each hypothesis using robust estimators that are capable of dealing with the usual statistical problems without sacrificing economic relevance and significance. The results indicate that globalization has varying effects on peace and stability, and peace and stability affect governance differently depending on what kind of globalization induces it. For instance, the effects on governance induced by globalization defined as trade are stronger than those resulting from globalization taken to be foreign direct investment. Hence, we conclude that foreign direct investment is not a powerful mechanism for stimulating and sustaining the knowledge economy in our sample of countries. However, since globalization-induced peace and stability have both positive and negative effects on governance simultaneously, we also conclude that while the prospect for knowledge economy in African countries is dim, it is still realistic and attainable as long as these countries continue to engage in the kind of globalization that does indeed induce peace and stability. We further conclude that there is a need for a sharper focus on economic and institutional governance than on general governance as one possible extension of this paper.

show abstract

“…Keefer (1997a &1997b), Campos and Nugent (1999), Olson et al (2000), Chauvet and Collier (2004) and Fayissa and Nsiah (2013) are a few of the empirical studies that highlight the importance of good-governance for growth. On the other hand, some studies have taken a skeptical view of governance as a determinant of economic growth.…”

Section: Literature Reviewmentioning

confidence: 99%

Revisiting the growth-governance relationship in developing Asian and Oceanic economies

Fayissa

Gill

2015

J Econ Finan

Self Cite

View full text Add to dashboard Cite

In recent decades, aid agencies, international financial institutions, and developed countries have placed an increased focus on institutional quality (governance) as a criterion for the allocation of financial assistance to the developing countries. Such foreign aid conditionality is based on the general consensus that better governance leads to better economic outcomes. For Asian and Oceanic economies, however, previous studies have reported a negative relationship between economic growth and governance terming it the 'growth-governance paradox'. We revisit the role of governance and economic growth using panel data for 37 Asian and Oceanic countries over the period of 1996-2013. Unlike previous studies, we employ panel analytic methodologies that account for different sources of biases and find that governance has, in fact, a positive relationship with growth in developing Asian and Oceanic economies.

show abstract

The Impact of Governance on Economic Growth in Africa

Cited by 131 publications

References 43 publications

Determinants of Growth in Fast‐Developing Countries: Evidence from Bundling and Unbundling Institutions

Determinants of Growth in Fast‐Developing Countries: Evidence from Bundling and Unbundling Institutions

Globalization, Peace & Stability, Governance, and Knowledge Economy

Revisiting the growth-governance relationship in developing Asian and Oceanic economies

Contact Info

Product

Resources

About