This study investigates the impact of foreign aid and remittance inflows on entrepreneurship progress in Africa. The role of institutional quality in the relationship between foreign aid and entrepreneurship is also investigated. We explore data of 19 African countries for a period of 2006-2017, and panel data regression techniques are employed. The study finds that: (1) Foreign aid impact on entrepreneurship is negative. (2) The remittances mediate the negative impact of foreign aid on entrepreneurship. (3) Institutional quality mediates the negative impact of foreign aid on entrepreneurial progress. (4) The threshold level of remittance at which foreign aid would meaningfully enhance entrepreneurship is 10.59 as a percentage of GDP while that of institutional quality is 5.04 on a scale of 10 point. (5) The role of remittances and foreign aids is complementary in firm start-up activities. (6) Institutional quality plays important roles in moderating impact of foreign aid on firm start-up activities. In addition, our results show that concentration in banking industry does not benefit entrepreneurial activities. The study concludes that foreign aids and remittances perform complementary roles in improving the level of entrepreneurial development in Africa. The strong institutional environment is very important in promoting entrepreneurial success. These findings are robust to alternative estimations.
PurposeThis study examines the effect of globalization on female economic participation (FEP) in MINT (Mexico, Indonesia, Nigeria and Turkey) and BRICS (Brazil, Russia, India, China and South Africa) countries between 2004 and 2018.Design/methodology/approachFour measures of globalization are employed and sourced from KOF globalization index, 2018, while the female labour force participation rate is a proxy for FEP. The empirical evidence is based on the Pooled Mean Group (PMG) estimator.FindingsThe findings of the PMG estimator from the Panel ARDL method reveal that political and overall globalization in MINT and BRICS countries have a positive impact on FEP, whereas social globalization exerts a negative impact on FEP in the long-run. It is observed that economic globalization has no long-run effect on FEP. Contrarily, all the measures of globalization reflect no short-run effect on FEP. This supports the argument that globalization has no immediate effect on FEP. Thus, it is recommended that both MINT and BRICS countries should find a way of improving the process of globalization generally to empower women to be involved in economic activities.Originality/valueThis study complements the extant literature by focusing on how globalization dynamics influence FEP in the MINT and BRICS countries.
An increasing number of studies are examining the relationship between entrepreneurship and growth. This relationship is controversial, especially for developing countries. Recent improvements in economic growth have led to a focus on growth inclusiveness, which spreads economic opportunities throughout a society. However, studies that focus on the role of entrepreneurship in inclusive growth remain scarce. To fill that gap, this study investigates the dynamic relationship between economic globalization, entrepreneurship, and inclusive growth in 21 African countries using panel econometrics to examine data covering 2006 to 2018. The results reveal that the impact of economic globalization and entrepreneurship on inclusive growth is positive and significant. We find that economic globalization enhances entrepreneurial development, and causality tests show that economic globalization drives inclusive growth. We also find a unidirectional causality from entrepreneurship to inclusive growth. Finally, we observe no direction of causality between economic globalization and entrepreneurship but observe a bidirectional causality between governance and entrepreneurship. We discuss the implications of these results.
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