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The main purpose of this study is to examine the impact of different dimensions of institutional quality indices on the economic growth of Sub-Saharan African (SSA) countries.
Abstract
Purpose
The main purpose of this study is to examine the impact of different dimensions of institutional quality indices on the economic growth of Sub-Saharan African (SSA) countries.
Design/methodology/approach
The study uses a panel data set of 31 SSA countries from 1991 to 2015 and employs a two-step system-GMM (Generalized Method of Moments) estimation technique.
Findings
The study's empirical results indicate that investment-promoting and democratic and regulatory institutions have a significant positive effect on economic growth; however, once these institutions are taken into account, conflict-preventing institutions do not have a significant impact on growth.
Practical implications
The study's findings suggest that countries in the region should continue their institutional reforms to enhance the region's economic growth. Specifically, institutions promoting investment, democracy and regulatory quality are crucial.
Originality/value
Unlike previous studies that use either composite measures of institutions or a single intuitional indicator in isolation, the present study has employed principal component analysis (PCA) to extract fewer institutional indicators from multivariate institutional indices. Thus, this paper provides important insights into the distinct role of different clusters of institutions in economic growth.
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Jean C. Kouam and Simplice Asongu
The study assesses the non-linear nexus between fixed broadband and economic growth. The study focuses on data from 33 African countries for the period 2010 to 2020.
Abstract
Purpose
The study assesses the non-linear nexus between fixed broadband and economic growth. The study focuses on data from 33 African countries for the period 2010 to 2020.
Design/methodology/approach
The empirical evidence is based on unit root tests, panel smooth transition regression and the generalized method of moments.
Findings
The following findings are established in this study. (1) The proportion of the population with access to electricity above and below which the relationship between fixed broadband and economic growth changes in sign is about 60%. (2) Below this threshold, each 1% increase in fixed broadband subscriptions induces a decline in economic growth of about 2.58%. Above the threshold, economic growth would increase by 2.43% when fixed broadband subscriptions increase by 1%. Sensitivity analyses and generalized method of moments (GMM) estimation show that these results are robust.
Practical implications
Due to the coronavirus disease (COVID-19) pandemic, which requires countries to take adequate measures to curb the spread of the pandemic, especially by means of virtual economic activities, any national policy aiming at improving the access of populations to high levels of fixed broadband services should be preceded by the implementation of an electrification program for at least 60% of the total population. Otherwise, providing a good quality internet connection for the benefit of the population would not produce the expected effects on economic growth and would, therefore, be counterproductive.
Originality/value
This study complements the extant literature by providing thresholds at which fixed broadband affects economic growth.
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Farmers are the largest group of financially excluded persons in Nigeria, thereby highlighting the supply shortfall in finance to agriculture in Nigeria. Availability of finance…
Abstract
Purpose
Farmers are the largest group of financially excluded persons in Nigeria, thereby highlighting the supply shortfall in finance to agriculture in Nigeria. Availability of finance would go a long way in improving output and productivity in agriculture, and consequently help in reducing poverty. This study conducts an empirical investigation of the effects of financial inclusion on agricultural productivity in Nigeria.
Design/methodology/approach
This study makes use of the Living Standards Measurement Study–Integrated Surveys on Agriculture (LSMS-ISA). This is a new data set on agricultural households which contains information on agricultural activities and various household activities, including banking, savings and insurance behaviour. Considering the data are such that there are observations for households over three time periods, the study exploits the time series and cross-section dimension of the data by using panel data estimation.
Findings
The empirical results of the study show that financial inclusion, irrespective of how it is measured, has exerted positive and statistically significant effects on agricultural productivity in Nigeria.
Originality/value
While considerable research has been conducted to examine how finance affects broad macroeconomic aggregates, little is known about the effects of finance at the household and individual level. It is important to explicitly account for financial inclusion when examining the effects of finance on individuals and households. This study improves on existing research and offers new insights into the effects of financial inclusion on the economic activities of agricultural households in Nigeria.
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Chukwuebuka Bernard Azolibe and Jisike Jude Okonkwo
The purpose of this study is to examine whether the state of infrastructure development in Sub-Saharan Africa actually stimulates industrial sector productivity, using a panel…
Abstract
Purpose
The purpose of this study is to examine whether the state of infrastructure development in Sub-Saharan Africa actually stimulates industrial sector productivity, using a panel data set of 17 countries spanning from 2003 to 2018.
Design/methodology/approach
The study used panel least square estimation technique to examine the relationship between the variables.
Findings
The result of the study indicates that the major factor that influences industrial sector productivity in Sub-Saharan Africa is their quantity and quality of telecommunication infrastructure. Analysis shows that the relatively low level of industrial sector productivity in Sub-Saharan Africa is largely due to their poor electricity and transport infrastructure and underutilization of water supply and sanitation infrastructure.
Practical implications
The government should partner with other developed countries of the world such as Germany, Japan, Sweden, Netherlands, Austria, Singapore, United States of America, United Kingdom, Switzerland and United Arab Emirates, which are the top ten countries in infrastructure ranking as currently released by the World Bank, to equally extend their quality infrastructure to their own country for enhanced industrialization.
Originality/value
The novelty of this research lies on the fact it is a cross-country study as against the few empirical studies that focused only on a single country. Also, the study made use of the four main indicators of infrastructure development in an economy, which are electricity infrastructure, transport infrastructure, telecommunication infrastructure and water supply and sanitation infrastructure, to examine its effect on industrial sector productivity in Sub-Saharan Africa.
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Cheikh Tidiane Ndour and Simplice Asongu
This study examines the relevance of information and communication technologies in the effect of gender economic inclusion on environmental sustainability.
Abstract
Purpose
This study examines the relevance of information and communication technologies in the effect of gender economic inclusion on environmental sustainability.
Design/methodology/approach
The focus is on a panel of 42 sub-Saharan African countries over the period 2005–2020. The empirical evidence is based on generalized method of moments. The environmental sustainability indicator used is CO2 emissions per capita. Three indicators of women’s economic inclusion are considered: female labour force participation, female employment and female unemployment. The chosen ICT indicators are mobile phone penetration, Internet penetration and fixed broadband subscriptions.
Findings
The results show that: (1) fixed broadband subscriptions represent the most relevant ICT moderator of gender economic inclusion for an effect on CO2 emissions; (2) negative net effects are apparent for the most part with fixed broadband subscriptions (3) both positive ICT thresholds (i.e., critical levels for complementary policies) and negative ICT thresholds (i.e., minimum ICT levels for negative net effects) are provided; (4) ICT synergy effects are apparent for female unemployment, but not for female employment. In general, the joint effect of ICTs or their synergies and economic inclusion should be a concern for policymakers in order to better ensure sustainable development. Moreover, the relevant ICT policy thresholds and mobile phone threshold for complementary policy are essential in promoting a green economy.
Originality/value
The study complements the extant literature by assessing linkages between information technology, gender economic inclusion and environmental sustainability.
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Stephen Kehinde Medase and Ivan Savin
Although employees' creativity is vital for firm innovation and overall performance, little is done to examine the potential association between creativity and employment. This…
Abstract
Purpose
Although employees' creativity is vital for firm innovation and overall performance, little is done to examine the potential association between creativity and employment. This paper investigates the contribution of employees' creativity, process and product innovations to firm-level employment growth.
Design/methodology/approach
The authors use data from World Bank Enterprise Survey and Innovation Follow-up Survey on 9503 firms covering the period 2012–2015 in 11 countries from sub-Saharan Africa and Heckman's two-stage estimation model.
Findings
This study's results indicate a positive role of creativity on firm-level employment growth. In addition, the authors find evidence for a complementary effect arising from the combination of creativity with managerial experience, staff level of education and their associated skills, in contrast, combining creativity with internal or external R&D results in a substitution effect. Interestingly, these synergy effects are pronounced for SMEs but absent for large firms.
Practical implications
Policy makers in developing economies of sub-Saharan Africa should stimulate company management to use free time offered to employees to be creative in the workplace as one of their key strategies to stimulate employment growth. This strategy is expected to be particularly fruitful among SMEs having some managerial experience and skilled stuff.
Originality/value
In contribution to innovative work practices and workforce creativity, the authors demonstrate that providing employees with free time could be an alternative way to enhance the focal firms' performance.
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Hermann Ndoya and Simplice A. Asongu
This study aims to analyse the impact of digital divide (DD) on income inequality in sub-Saharan Africa over the period 2004–2016.
Abstract
Purpose
This study aims to analyse the impact of digital divide (DD) on income inequality in sub-Saharan Africa over the period 2004–2016.
Design/methodology/approach
In applying a finite mixture model (FMM) to a sample of 35 sub-Saharan African (SSA) countries, this study posits that DD affects income inequality differently.
Findings
The findings show that the effect of DD on income inequality varies across two distinct groups of countries, which differ according to their level of globalization. In addition, the study shows that most globalized countries are more inclined to be in the group where the effect of DD on income inequality is negative. The results are consistent with several robustness checks, including alternative measures of income inequality and additional control variables.
Originality/value
This study complements that extant literature by assessing linkages among the DD, globalization and income inequality in sub-Saharan African countries contingent on cross-country heterogeneity.
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