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201. Performance of Small and Medium-Sized Enterprises in Uganda: The Role of Innovation

Author:
Ibrahim Okumu and Faizal Buyinza
Publication Date:
11-2019
Content Type:
Policy Brief
Institution:
African Economic Research Consortium (AERC)
Abstract:
Using the 2013 World Bank Enterprise Survey data for Uganda, this paper employs the quintile estimation technique to explain the relationship between innovation and firm performance in small and medium-sized enterprises (SMEs). Innovation involves the introduction of a new or significantly improved production process, product, marketing technique or organizational structure. Our results indicate that individual processing, product, marketing and organizational innovations have no impact on labour productivity as proxied by sales per worker. However, the results indicate the presence of complementarity between the four types of innovation. Specifically, the effect of innovation on sales per worker is positive when an SME engages in all four types of innovation. Even then the complementarity is weakly positive with incidences of a negative relationship when using any combination of innovations that are less than the four types of innovation. Policy-wise the results suggest that efforts to incentivize innovation should be inclusive enough to encourage all four forms of innovation.
Topic:
Development, Economics, International Political Economy, Economic Growth, and Economic Policy
Political Geography:
Uganda and Africa

202. Household Economic Well-Being and Child Health in The Democratic Republic of Congo

Author:
Janvier Mwisha-Kasiwa
Publication Date:
11-2019
Content Type:
Policy Brief
Institution:
African Economic Research Consortium (AERC)
Abstract:
Health is both a direct component of human well-being and a form of human capital that increases an individual’s capabilities and opportunities to generate income and reduces vulnerability. It is argued that these two views are complementary, and both can be used to justify increased investment in health in developing countries. Therefore, investment in child health constitutes a potential mechanism to end the intergenerational transmission of poverty. This paper examines the empirical impact of household economic well-being on child health, and the gender differences in effects using the Demographic and Health Survey conducted in 2014. A series of econometric tools are used; the control function approach appears to be the most appropriate strategy as it simultaneously removes structural parameters from endogeneity, the sample selection and heterogeneity of the unobservable variables. Results suggest a significant positive effect of household economic well-being on child health. However, the magnitude of the effect varies by gender of household head; children from households headed by males appear healthier compared to those from female-headed households. In the context of DR Congo, female-headed households often have a single parent, therefore, the economic well-being effect on child health in the male sub-sample can be considered to include the unobserved contribution of women. These results have implications for public interventions that enable women to participate in paid labour market activities as a means of improving household economic well-being, which in turn could improve child health.
Topic:
Development, Economics, Gender Issues, Health, Health Care Policy, and Children
Political Geography:
Africa and Democratic Republic of Congo

203. The Productivity Cost of Power Outages for Manufacturing Small and Medium Enterprises in Senegal

Author:
Lassana Cissokho
Publication Date:
11-2019
Content Type:
Policy Brief
Institution:
African Economic Research Consortium (AERC)
Abstract:
This paper investigates the productivity effects of power outages on manufacturing Small Scale Enterprises (SMEs) in Senegal, using a panel data on manufacturing firms. Productivity is estimated using stochastic frontier models, and power outages measured by their frequency or their duration. We controlled for firms owning a generator as well. The main results are drawn from random effects in a linear panel model. Nonetheless, the results remain consistent to the robustness checks using different models: a double-sided truncated data model and a generalized linear model, and different productivity measures: data envelopment analysis. We find that power outages have negative significant effects on the productivity of SMEs; for example, the manufacturing sector lost up to around 11.6% of the actual productivity due to power outages in 2011, and small firms appear to be affected more than medium ones, 5% against 4.3%. Further, firms with a generator were successful in countering the adverse effect of power outages on productivity. Besides, another outstanding result is the significant positive effect of access to credit on productivity. At last, it appears that productivity increases with firms’ size.
Topic:
Development, Economics, International Political Economy, Economic structure, Economic Growth, Macroeconomics, and Manufacturing
Political Geography:
Africa and Senegal

204. The Linkage between Foreign Direct Investment and Intra-Regional Trade within ECOWAS

Author:
Eme Dada
Publication Date:
08-2019
Content Type:
Policy Brief
Institution:
African Economic Research Consortium (AERC)
Abstract:
The objective of this policy brief is to inform the Ministers of Trade and Investment of Economic Community of West African State (ECOWAS) countries about the importance of the linkage between Foreign Direct Investment (FDI) and trade for developing countries. FDI is considered an important means of promoting export of the host countries. This is true of inward FDI, which comes for efficiency reasons. Conversely, there is concern that large flows of outward FDI results in a decline in the host country’s exports and loss of jobs. This in turn assumes that the exports of the source country will fall as FDI substitutes for trade.
Topic:
Development, Economics, International Trade and Finance, Foreign Direct Investment, and Economic Growth
Political Geography:
Africa, Liberia, Sierra Leone, Senegal, Mali, Guinea, Guinea-Bissau, Cape Verde, and Gambia

205. The Impact of Macroeconomic Variables on Capital Market Development in Botswana’s Economy

Author:
Koketso Molefhi
Publication Date:
03-2019
Content Type:
Working Paper
Institution:
Botswana Institute for Development Policy Analysis
Abstract:
The study examines the impact of macroeconomic variables on stock and bond markets development in Botswana using Autoregressive Distributed Lag (ARDL)-Bounds Test. The results indicate that macroeconomic variables have an impact on capital market development in Botswana. In the short run, real output, money supply and inflation have a positive influence on the development of the stock market, while real exchange rate retards its development. Real output further supports the development of the stock market in the long run. For the bond market, only two variables, inflation rate and lending rate have positive and negative impact on the bond market in the long run respectively, while none of the variables influence the bond market in the short run. Policy implications include increased efforts by policy makers to increase money supply, gross domestic product for the development of stock market, while the bond market development requires a decrease in lending rates.
Topic:
Development, Economy, Macroeconomics, and Stock Markets
Political Geography:
Africa and Botswana

206. Challenges of Project Implementation in Local Government: The Case of Francistown City Council and Kweneng District Council

Author:
Thabile A. Samboma
Publication Date:
03-2019
Content Type:
Working Paper
Institution:
Botswana Institute for Development Policy Analysis
Abstract:
Botswana is faced with many challenges of project implementation. Since independence detailed projects and programmes were initiated, with limited and often less developed state capacity to implement them. This study focuses on challenges of project implementation in Botswana’s tier of local government. A qualitative case research method approach was employed to undertake the study. Telephonic interviews were conducted with politicians and employees from Francistown City Council (FCC) and Kweneng District Council (KDC) and data was analysed using thematic analysis. The paper outlines project implementation challenges in Local Authorities (LA). For instance, lack of capacity, lack of commitment by the District Development Committee (DDC), poor stakeholder engagement and lack of financial autonomy by councils. Some of the identified implementation challenges are not peculiar to the two LAs but cuts across local authorities in Botswana. However, low human capacity in local authorities was cited as a major problem in project implementation.
Topic:
Development, Government, Policy Implementation, and Authority
Political Geography:
Africa and Botswana

207. Leaders for a New Africa: Democrats, Autocrats, and Development

Author:
Giovanni Carbone
Publication Date:
10-2019
Content Type:
Special Report
Institution:
Italian Institute for International Political Studies (ISPI)
Abstract:
Political leadership can be a crucial ingredient for the development of sub-Saharan Africa. The region has been going through important transformations, with both political landscapes and economic trajectories becoming increasingly diverse. The changes underway include the role of leadership and its broader impact. This volume argues that, on the whole, African leaders and the way they reach power generally do contribute to shaping their countries’ progresses and achievements. It also zooms in on some influential African leaders who recently emerged in key states across the continent, illustrating and explaining the individual paths that brought them to power while reflecting on the prospects for their governments’ actions. Far from the simplistic stereotypes of immovable, ineffective and greedy rulers, the resulting picture reveals dynamic and rapidly evolving political scenarios with key implications for development in the region.
Topic:
Development, Politics, Democracy, Leadership, and Autocracy
Political Geography:
Africa and Sub-Saharan Africa

208. Building an EU-Africa Partnership of Equals: A Roadmap for the New European Leadership

Author:
Anita Kappeli
Publication Date:
09-2019
Content Type:
Special Report
Institution:
Center for Global Development
Abstract:
The arrival of a new leadership team in Brussels provides an opportunity for Europe to reinvigorate its role as a global development power and to build a true partnership with its continental neighbour, Africa. These tasks have never been more urgent. With only 10 years to go, the world is far from achieving the Sustainable Development Goals (SDGs) by 2030. A confluence of well-documented global trends, including accelerating climate change, declining multilateralism, and the erosion of democratic norms, is only increasing the challenge.
Topic:
Development, Diplomacy, International Cooperation, European Union, Sustainability, and African Union
Political Geography:
Africa and Europe

209. Multilingual Assessment of Early Child Development: Analyses from Repeated Observations of Children in Kenya

Author:
Heather A. Knauer, Patricia Kariger, Pamela Jakiela, Owen Ozier, and Lia C.H. Fernald
Publication Date:
10-2019
Content Type:
Working Paper
Institution:
Center for Global Development
Abstract:
In many low- and middle-income countries, young children learn a mother tongue or indigenous language at home before entering the formal education system where they will need to understand and speak a country’s official language(s). Thus, assessments of children before school age, conducted in a nation’s official language, may not fully reflect a child’s development, underscoring the importance of test translation and adaptation. To examine differences in vocabulary development by language of assessment, we adapted and validated instruments to measure developmental outcomes, including expressive and receptive vocabulary. We assessed 505 2-to-6- year-old children in rural communities in Western Kenya with comparable vocabulary tests in three languages: Luo (the local language or mother tongue), Swahili, and English (official languages) at two time points, 5–6 weeks apart, between September 2015 and October 2016. Younger children responded to the expressive vocabulary measure exclusively in Luo (44–59% of 2-to-4-year-olds) much more frequently than did older children (20–21% of 5-to-6-year-olds). Baseline receptive vocabulary scores in Luo (β = 0.26, SE = 0.05, p < 0.001) and Swahili (β = 0.10, SE = 0.05, p = 0.032) were strongly associated with receptive vocabulary in English at follow-up, even after controlling for English vocabulary at baseline. Parental Luo literacy at baseline (β = 0.11, SE = 0.05, p = 0.045) was associated with child English vocabulary at follow-up, while parental English literacy at baseline was not. Our findings suggest that multilingual testing is essential to understanding the developmental environment and cognitive growth of multilingual children.
Topic:
Development, Children, Linguistics, and Language
Political Geography:
Kenya and Africa

210. ABCs of the IFIs: The African Development Bank, the Asian Development Bank, and the International Fund for Agricultural Development

Author:
Scott Morris, Erin Collinson, and Alysha Gardner
Publication Date:
10-2019
Content Type:
Policy Brief
Institution:
Center for Global Development
Abstract:
The African Development Bank (AfDB), the Asian Development Bank (ADB), and the International Fund for Agricultural Development (IFAD) are among the international financial institutions seeking pledges from donor countries as part of upcoming replenishment cycles in 2019 and 2020. The United States is a leading donor to these funds and has played a crucial role in shaping the institutions’ agendas throughout their histories.
Topic:
Agriculture, Development, Finance, Banks, Institutions, and Banking
Political Geography:
Africa and Asia