MODERATING EFFECT OF STATE FRAGILITY ON THE GLOBALISATION: ECONOMIC GROWTH NEXUS IN SUB-SAHARAN AFRICA

Christian Agu

Journal of Academic Research in Economics, 2024, vol. 16, issue 2 (July), 239-264

Abstract: This paper uses panel data over the 2006 - 2019 periods, a modified endogenous growth equation, and a dynamic panel estimator to investigate the impact of globalization on economic growth in Sub-Saharan African (SSA) countries, and how the fragility of SSA countries is influencing this impact. Utilizing a two-step System GMM, the findings of the study show that globalization had a significant positive impact on economic growth, while the impact of state fragility is negative and significant. In examining the role of state fragility, as a moderator, in the globalization-economic growth nexus, the findings reveal that the interactive effect of state fragility and globalization on economic growth is negative and statistically significant. This suggests that state fragility interacts with globalization to weaken the impact of the latter on economic growth. The study therefore recommend that there is the urgent need for decision makers in SSA to chart a new course towards ending the incessant instability associated with the zone.

Keywords: globalization; state fragility; economic growth; interaction; system GMM; SSA. (search for similar items in EconPapers)
JEL-codes: C33 F02 F15 F51 F60 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:shc:jaresh:v:16:y:2024:i:2:p:239-264

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