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Thresholds of External Flows for Inclusive Human Development in Sub-Saharan Africa

Simplice Asongu (), Joseph Uduji () and Elda Okolo-Obasi ()
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Elda Okolo-Obasi: University of Nigeria, Nsukka, Nigeria

No 19/045, Working Papers of the African Governance and Development Institute. from African Governance and Development Institute.

Abstract: This research investigates the incidence of enhancing external flows on inclusive human development in a panel of 48 countries in sub-Saharan Africa. It complements the literature by examining the relevance of enhancing three types of external flows, namely: development assistance, foreign investment and remittances. Ordinary Least Squares, Tobit, Fixed effects, Generalised Method of Moments and Quantile regressions are used as empirical strategies. The following main results are apparent: (i) between 60 and 150 (% of GDP) is the threshold of foreign aid; (ii) 33.333 (% of GDP) is the foreign investment threshold and (iii) 25 (% of GDP) is the critical mass of remittances. At the established critical masses or thresholds, external flows start having positive effects on inclusive human development. Countries characterized by inclusive development levels that are low need more investment in foreign aid for inclusive human development compared to their counterparts characterized by inclusive human development levels that are high.

Keywords: Foreign investment; Remittances; Foreign aid; Inclusive development; Africa (search for similar items in EconPapers)
JEL-codes: F21 F24 F35 I30 O55 (search for similar items in EconPapers)
Date: 2019-01
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Forthcoming: International Journal of Community Well-Being

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http://www.afridev.org/RePEc/agd/agd-wpaper/Thresh ... b-Saharan-Africa.pdf Revised version, 2019 (application/pdf)

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Working Paper: Thresholds of External Flows for Inclusive Human Development in Sub-Saharan Africa (2019) Downloads
Working Paper: Thresholds of External Flows for Inclusive Human Development in Sub-Saharan Africa (2019) Downloads
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