Foreign Aid, Resources and Export Diversification in Africa: A New Test of Existing Theories

Patrick Osakwe

MPRA Paper from University Library of Munich, Germany

Abstract: Recent theoretical literature suggests that aid, geography, and resource endowments affect diversification of exports in Africa. This paper examines the validity of these popular views using a System-GMM methodology and panel data for African countries. The evidence suggests that aid, the quality of infrastructure, and resource endowments are robust determinants of diversification in Africa. It also suggests that there is no systematic relationship between geography and diversification. Furthermore, there is some evidence that institutional factors are important although it is not robust. Finally, the paper offers recommendations on how to promote export diversification in the region.

Keywords: Exports; Aid; Diversification; Africa; Endowments (search for similar items in EconPapers)
JEL-codes: F13 F35 O14 (search for similar items in EconPapers)
Date: 2007-03
New Economics Papers: this item is included in nep-afr and nep-dev
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:2228

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