Economic Deregulation and Trade Liberalization in Kenya, Tanzania and Uganda: Growth and Poverty

Read, Donna; Parton, Kevin A.

doi:10.2753/jei0021-3624430301

Cited by 7 publications

(6 citation statements)

References 36 publications

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“…Evidence from the literature reviewed showed that some of the studies employed cross-country backgrounds by assessing the results of trade liberalization between developing and developed economies or within a designated group of developing countries (Barro & Sala-i-Martin, 1997;Dollar & Kraay, 2003;Dollar, 1992;Edwards, 1998;Greenaway, Morgan, & Wright, 2002;Harrison, 1996;Read & Parton, 2009;Sachs & Warner, 1995;Vamvakidis, 2002). The results of the link between trade liberalization and economic growth were mixed.…”

Section: Empirical Literaturementioning

confidence: 99%

Trade Liberalization and Economic Growth: An Assessment of Nigerian Experience

Duru

Okafor

Adikwu

et al. 2020

Asian Development Policy Review

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The association between trade liberalization and economic growth in Nigeria was examined in this study from 1981 to 2018. The study used the Autoregressive Distributed Lag Bounds technique to cointegration. The results showed that trade liberalization do not support economic growth in Nigeria. Hence, the genuineness of the extensive trade liberalization campaign in developing countries through the bright idea of international organizations in the late 1980s and early 1990s was not validated. Furthermore, the results showed the presence of unidirectional causality from real Gross Domestic Product to trade liberalization in Nigeria. The study, therefore, recommends that policymakers of the government should balance its strategies of trade liberalization as a result of the inability of the economy to absorb the adverse shocks from foreign trade, appropriate fiscal and monetary policies should be deployed by the government for the protection of the economy against foreign influences and the diversification of the structure of export is necessary to ensure that manufactured products are exported more. Also, the Central Bank of Nigeria and policymakers of the government should prescribe sound macroeconomic policies that will ensure price stability to reduce the uncertainties associated with investment in the economy to boost economic growth. The government should also provide incentives to investors and a conducive environment for investment. Moreover, the government should initiate policies of growth for the promotion of trade. Contribution/ Originality: This study established a fact-based decision making for the realization of a trade-led economic growth and development strategies in Nigeria through the direction of causality between the principal variables. This study has deep evidence of originality; hence, the validity, reliability and uniqueness are not in doubt.

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Section: Empirical Literaturementioning

confidence: 99%

Trade Liberalization and Economic Growth: An Assessment of Nigerian Experience

Duru

Okafor

Adikwu

et al. 2020

Asian Development Policy Review

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“…While the traditional cost discovery and export upgrading and export complexity theory (Hausmann et al, 2007;Hidalgo and Hausmann, 2009; IJDI 23,2 Koch, 2021) are a compelling arguments, these do not hold as our sample focuses on ECOWAS countries. These countries generally rank low in terms of production structures, and this chronic structural transformation was highlighted in earlier seminal studies (Collier and Gunning, 1999;Read and Parton, 2009;Sachs, 2004). In addition, the majority of FDI inflows for the ECOWAS region tend to be focused on the primary sector, particularly in extractive industries (Geda, 2018).…”

Section: Growth Gains From Foreign Investmentmentioning

confidence: 99%

“…The literature has highlighted the chronic slow growth and persistent low productivity in many African countries as they fail to structurally transform their production structures (Ben Hammouda et al , 2010; Collier and Gunning, 1999; Clark et al , 2016; Read and Parton, 2009; Sachs, 2004). This implies the absence of production linkages from the perspective of product space, which limits their absorptive capacity (Hidalgo and Hausmann, 2009).…”

Section: Theoretical Considerations and Literature Reviewmentioning

confidence: 99%

“…Many African countries suffer from slow chronic growth and lack the ability to structurally transform their economic systems, leading to persistent poverty and a low productivity trap (Collier and Gunning, 1999; Read and Parton, 2009; Sachs, 2004). As a result, many African nations have implemented economic and industrial policies while receiving official development assistance to enhance economic development (Beck, 2015; King and Ramlogan-Dobson, 2015).…”

Section: Introductionmentioning

confidence: 99%

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Does export structure enhance the growth gains from foreign investment? Evidence from the ECOWAS region

Haini

Loon

Raimi

2023

IJDI

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Purpose This study aims to examine whether diversified economies enhance the growth benefits from foreign direct investment (FDI). Diversified economies benefit from stable export earnings, stable investment composition and greater factor endowments through forward and backward linkages that can leverage superior foreign technology embedded in FDI. This is crucial as many African economies suffer from dependency while FDI is concentrated in the primary sector. Design/methodology/approach The authors use a dataset of 15 Economic Community of West African States from 1995 to 2020 and compile variables from various sources, including an export diversification index measured using the Herfindahl–Hirschman index of product concentration. The authors use a growth regression model estimated using dynamic panel estimators to control for endogeneity and simultaneity issues. Findings The results show that the effects of direct FDI are insignificant to growth considering diversification and controlling for other confounding factors. Meanwhile, diversification is associated with growth, which highlights the importance of industrial policy. More importantly, the authors find that the marginal effects of FDI are positively and significantly associated with growth when diversification levels are low, implying that production structure matters for the FDI–growth nexus in developing economies. Originality/value Previous studies have overlooked the role of export production structure on the FDI–growth nexus. Many developing economies are dependent on primary exports and suffer from dependency, which implies lower levels of factor endowments. As such, this reduces the growth gains from FDI. The authors provide new empirical evidence on the importance of export production structure on the FDI–growth nexus.

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“…This suggests that different regions have different underlying conditions in such a way that the same rate of economic growth produces a varied impact on poverty and people's wellbeing. For instance, to this end, some scholars [8,10,23,24] attest that in the recent years most of the sub-Sahara African countries have experienced wealth without prosperity; the rapid economic progress is not accompanied with household poverty reduction and improved quality of life.…”

Section: Brief Literature Reviewmentioning

confidence: 99%

Is Tanzania’s economic growth leaving the poor behind? A nonlinear autoregressive distributed lag assessment

2022

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Most developing economies have recently experienced significant economic growth without corresponding substantial poverty reduction and improved population wellbeing. This paper uses a nonlinear autoregressive distributed lag model to explore the growth-poverty relationship in Tanzania using annual time series data on per capita consumption expenditure, real GDP, GINI index, and unemployment from 1991–2020. To explore the causality among the variables and long-run asymmetry between per capita consumption expenditure and economic growth, the study employs Granger causality and Wild test respectively. The results confirm the presence of long and short-run asymmetric behavior of economic growth. Besides, in the short-run, the Granger causality test supported the feedback hypothesis between economic growth and consumption expenditure, and the unidirectional hypothesis from income inequality and unemployment to consumption expenditure. In the long-run, unidirectional causality was observed from consumption expenditure to both economic growth and unemployment. The study submits that while economic growth exhibits poverty reduction features, growth alone is not sufficient to alleviate poverty because the interaction of income inequality with economic growth dampens the poverty-reducing effects of economic growth. Therefore, economic growth has a significant explanation for poverty but not all about the evolution of poverty. The study opens policy perspectives with wide international relevancy as outlined in the policy implication section.

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Economic Deregulation and Trade Liberalization in Kenya, Tanzania and Uganda: Growth and Poverty

Cited by 7 publications

References 36 publications

Trade Liberalization and Economic Growth: An Assessment of Nigerian Experience

Trade Liberalization and Economic Growth: An Assessment of Nigerian Experience

Does export structure enhance the growth gains from foreign investment? Evidence from the ECOWAS region

Is Tanzania’s economic growth leaving the poor behind? A nonlinear autoregressive distributed lag assessment

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