A Governance Dividend for Sub-Saharan Africa?

Amine Hammadi, Marshall Mills, Nelson Sobrinho, Vimal Thakoor and Ricardo Velloso

No 2019/001, IMF Working Papers from International Monetary Fund

Abstract: Countries in Sub-Saharan Africa (SSA) tend to lag those in most other regions in terms of governance and perceptions of corruption. Weak governance undermines economic performance through various channels, including deficiencies in government functions and distortions to economic incentives. It thus stands to reason that SSA countries could strengthen their economic performance by improving governance and reducing corruption. This paper estimates that strengthening governance and mitigating corruption in the region could be associated with large growth dividends in the long run. While the process would take considerable time and effort, moving the average SSA country governance level to the global average could increase the region’s GDP per capita growth by about 1-2 percentage points.

Keywords: WP; significance level; terms of trade; null hypothesis; Corruption; Governance; Institutions; Economic Growth; corruption perception; governance indicator; government effectiveness; governance × SSA; governance × LAC; governance channel; Inflation; Personal income; Estimation techniques; Sub-Saharan Africa; Global (search for similar items in EconPapers)
Pages: 43
Date: 2019-01-11
New Economics Papers: this item is included in nep-dev
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Citations: View citations in EconPapers (5)

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