Quality of Sub-national Government and Regional Development in Africa

Abstract

Despite widespread interest in government quality and economic development, the role of sub-national government has been largely overlooked. This represents an omission in Africa, given ongoing processes of devolution in much of the continent. In this article, we consider the impact of sub-national government institutions on economic development in 356 regions across 22 African countries. We create a novel index of sub-national government quality based on large-scale survey data and assess its impact on regional economies using satellite data on night light luminosity. To address causality concerns, we instrument subnational government quality with data from pre-colonial societies. Our results show a positive and significant relationship between sub-national government quality and regional economic development, even when controlling for the quality of national level institutions. Better subnational governments are a powerful but often overlooked determinant of development in Africa.

Improving Government Quality in the Regions of the EU and its System‐Wide Benefits for Cohesion Policy

“…In addition to the research on government quality and the returns of European Cohesion policy by Rodríguez‐Pose and Garcilazo (2015), several contributions have shown that local institutional quality impinges on economic growth through its effect on different policies and investments, such as interventions to promote entrepreneurship (Nistotskaya et al ., 2015; Aparicio et al ., 2016; Huggins and Thompson, 2016), regional competitiveness (Annoni and Dijkstra, 2017), innovation (Rodríguez‐Pose and Di Cataldo, 2015), productivity (Kaasa, 2016), industrial diversification (Cortinovis et al ., 2017), resilience (Ezcurra and Rios, 2019), or infrastructure (Crescenzi et al ., 2016). Similar work has been carried out outside Europe (for example, Rodríguez‐Pose and Zhang, 2019; Iddawela et al ., 2021). Overall, the bulk of this literature highlights that local government quality is a fundamental shaper of economic growth (Ketterer and Rodríguez‐Pose, 2018) and that the connection between the quality of local institutions and economic performance is achieved both directly and indirectly, through how variations in government quality shape the design, implementation, and monitoring of public policies.…”

Research Deserts and Oases: Evidence from 27 Thousand Economics Journal Articles on Africa*

“…In columns 1-3 of Table 7, I find that the correlation of the amount of research at the subnational level with population and GDP per capita is positive and highly statistically significant, while the correlation with international aid is positive but not statistically significant, closely paralleling the country-level results in columns 1-3 of Table 4. 27 Since the Global Peace Index and the Liberal Democracy Index are not available at the subnational level, I include different proxies for peacefulness and institutions -the number of ACLED conflict events and an index of subnational government quality derived from Afrobarometer survey data (Iddawela, Lee and Rodr íguez-Pose, 2021). Results in column 4 suggest that -conditional on the amount of research on the country as a whole, which is less in less peaceful countries with worse institutions -more research is done in subnational regions with more conflict events.…”

Review of sub-national institutional performance in Ghana

“…The literature on the concept, measurement, causes, and correlates of sub-national institutional governance is not new-see Chachu et al (2020) for a recent review of this literature. From the seminal work of Putnam et al (1993) to recent attempts by Iddawela et al (2021), several authors have explored untapped spaces that contribute to our understanding of the relationship between sub-national governance and development. Putnam et al (1993) explore about 20 regional governments in Italy in their attempt to explain the striking sub-national variations in the country's development.…”

“…Putnam et al (1993) explore about 20 regional governments in Italy in their attempt to explain the striking sub-national variations in the country's development. More recently, Iddawela et al (2021) combine satellites data with the construction of sub-national government quality indices across 356 sub-national governments in 22 African countries to explain variations in regional development in Africa. The latter attempt, perhaps among few others, adds to the dotted landscape of studies that focus on developing regions, such as Africa.…”