Price Distortions and Economic Growth in Sub-Saharan Africa
Kym Anderson () and
Markus Brückner ()
No 8530, CEPR Discussion Papers from C.E.P.R. Discussion Papers
To what extent has Sub-Saharan Africa’s slow economic growth over the past five decades been due to price and trade policies that have discouraged production of agricultural relative to non-agricultural tradables? This paper uses a new set of estimates of policy distortions to relative prices to address this question econometrically. We first test if these policy distortions respond to economic growth, using rainfall and international commodity price shocks as instrumental variables. We find that on impact there is no significant response of relative price distortions to changes in real GDP per capita. We then test the reverse proposition and find a statistically significant and sizable negative effect of relative price distortions on the growth rate of Sub-Saharan African countries. Our fixed effects estimates suggest that, during 1960-2005, a one standard deviation increase in distortions to relative prices reduced the region’s real GDP per capita growth rate by about half a percentage point per annum.
Keywords: Agricultural incentives; Economic growth; Trade restrictions (search for similar items in EconPapers)
JEL-codes: F14 F43 N17 O13 O55 Q18 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-afr, nep-agr, nep-dev and nep-opm
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed
Downloads: (external link)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at email@example.com
Working Paper: Price Distortions and Economic Growth in Sub-Saharan Africa (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:8530
Ordering information: This working paper can be ordered from
http://www.cepr.org/ ... ers/dp.php?dpno=8530
Access Statistics for this paper
More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 77 Bastwick Street, London EC1V 3PZ..
Series data maintained by (). This e-mail address is bad, please contact .