The Impact of Liberalisation Policies on Inequality in Africa

Simplice Asongu and Michael Batuo

No 12/038, Working Papers of the African Governance and Development Institute. from African Governance and Development Institute.

Abstract: Despite over three decades of Liberalisation policies in Africa, income-inequality has stayed persistently high. Using updated panel data of 26 African countries spanning the period 1996-2010, this study examines the effect of liberalisation policies with particular focus on financial, trade, institutional, political and economic liberalisations on income-inequality. We find: that financial liberalisation has a levitated income-redistributive effect with the magnitude of the de jure measure (KAOPEN) higher than that of the de facto measure (FDI); that exports, trade and ‘freedom to trade’ have an equality incidence on income-distribution; and that institutional and political liberalisation has a negative impact. We also find that, economic freedom has a negative income-redistributive effect possibly because of the weight of its legal component. The impact of these policies implications are discussed in detail in this study.

Keywords: Liberalisation Policies; Income Inequality; Poverty; Africa (search for similar items in EconPapers)
JEL-codes: F30 F41 F50 O15 O55 (search for similar items in EconPapers)
Pages: 38
Date: 2012-06-19
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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