Comparative Determinants of Quality of Growth in Developing Countries

Asongu, Simplice and Asongu, Ndemaze (2017): Comparative Determinants of Quality of Growth in Developing Countries. Forthcoming in: International Journal of Happiness and Development

Abstract

This study explores a new dataset in order to present the comparative determinants of growth quality in 93 developing countries for the period 1990-2011. We employ both cross-sectional and panel estimation techniques with contemporary and non-contemporary specifications. The determinants are quite heterogeneous in significance and magnitude with substantial inclinations to specifications and estimation techniques. We present and discuss the findings in increasing magnitude of significance so as to ease comparative readability. We also discuss how specificities in the modelling techniques are relevant for targeting growth quality. The results are timely and relevant for the post-2015 inclusive and sustainable development agenda.

• Item Type: MPRA Paper
• Language: English
• Keywords: Quality of growth; Development
• Subjects: I - Health, Education, and Welfare > I1 - Health > I10 - General; I - Health, Education, and Welfare > I2 - Education and Research Institutions > I20 - General; I - Health, Education, and Welfare > I3 - Welfare, Well-Being, and Poverty > I32 - Measurement and Analysis of Poverty; O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O40 - General; O - Economic Development, Innovation, Technological Change, and Growth > O5 - Economywide Country Studies > O57 - Comparative Studies of Countries

References

Alan, K., & Carlyn, R-D., (2015). “Is Africa Actually Developing?”, World Development, 66(C), pp. 598-613.

Allen, K., (2014). “Review: Thomas Piketty, Capital in the Twenty First Century”, Irish Maxist Review, 3(10)

Amavilah, V. H. S., (2014). “Sir W. Arthur Lewis and the Africans: Overlooked Economic Growth Lessons”, MPRA Paper No. 57126, Munich.

Anand, R., Mishra, S., & Peiris, S. J., (2013). “Inclusive Growth: Measurement and Determinants”, IMF Working Paper 13/135, Washington.

Anand, R., Mishra, S., & Spatafora, N., (2012), “Structural Transformation and the Sophistication of Production,” IMF Working Paper No. 12/59, Washington.

Anyanwu, J. C., (2014a). “Marital Status, Household Size and Poverty in Nigeria: Evidence from the 2009/2010 Survey Data”, African Development Review, 26(1), pp. 118-137.

Anyanwu, J. C., (2014b). “Determining the correlates of poverty for inclusive growth in Africa”, European Economics Letters, 3(1), pp. 12-17.

Anyanwu, J. C., (2013a). “Gender Equality in Employment in Africa: Empirical Analysis and Policy Implications”, African Development Review, 25(4), pp. 400-420.

Anyanwu, J. C., (2013b). “The correlates of poverty in Nigeria and policy implications”, African Journal of Economic and Sustainable Development, 2(1), pp. 23-52.

Asongu, S. A., Amavilah, V., & Andrés, R. A., (2014). “Economic Implications of Business Dynamics for KE-Associated Economic Growth and Inclusive Development in African Countries”, African Governance and Development Institute Working Paper No. 14/023, Yaoundé.

Asongu, S. A., Efobi, U., & Beecroft, I., (2015). “Inclusive human development in pre-crisis times of globalisation-driven debts”, African Development Review, 27(4), pp. 428–442.

Asongu, S. A., (2013). “Investment and Inequality in Africa: Which Financial Channels Are Good for the Poor”, African Finance Journal, 15(2), pp. 43-65.

Asongu, S. A., (2014a). “African Development: Beyond Income Convergence”, South African Journal of Economics, 82(3), pp. 334-353.

Asongu, S. A., (2014b). “The Questionable Economics of Development Assistance in Africa: Hot-Fresh Evidence, 1996-2010”, The Review of Black Political Economy, 41(4), pp 455-480.

Asongu, S. A., & Le Roux, S., (2017). “Enhancing ICT for Inclusive Human Development in Sub-Saharan Africa”, Technological Forecasting and Social Change, 118(May), pp. 44-54.

Asongu, S. A., & Nwachukwu, J. C., (2016a). “Welfare Spending and Quality of Growth in Developing Countries: Evidence from Hopefuls, Contenders and Best Performers”, The Social Science Journal, 53(4), pp. 495-500.

Asongu, S. A., & Nwachukwu, J. C., (2016b). “Rational Asymmetric Development, Piketty and Poverty in Africa”, The European Journal of Comparative Economics, 13(2), pp. 221-246.

Asongu, S. A., & Nwachukwu, J. C., (2017a). “Quality of Growth Empirics: Comparative Gaps, Benchmarking and Policy Syndromes”, Journal of Policy Modeling: Forthcoming.

Asongu, S. A., & Nwachukwu, J. C., (2017b).“Comparative human development thresholds for absolute and relative pro-poor mobile banking in developing countries”. Information Technology & People. DOI: 10.1108/ITP-12-2015-0295.

Asongu & Nwachukwu (2017c) “Finance and Inclusive Human Development: Evidence from Africa”, Brussels Economic Review; Forthcoming.

Asongu, S. A., & Nwachukwu, J. C., (2017d). “Foreign Aid and Inclusive Development: Updated Evidence from Africa, 2005–2012”, Social Science Quarterly, 98(1), pp. 282–298.

Azzimonti, M., De Francisco, E., Quadrini, V., (2014). “Financial Globalisation, Inequality and the Rising Public Debt”, American Economic Review, 104(8), pp. 2267-2302.

Baliamoune-Lutz, M., & McGillivray, M., (2009). “Does Gender Inequality Reduce Growth in Sub-Saharan Africa and Arab Countries?”, African Development Review, 21(2), pp. 224-242.

Baliamoune-Lutz, M., (2007). “Globalisation and Gender Inequality: Is Africa Different?”, Journal of African Economies, 16(2), pp. 301-348.

Barro, R., & Lee, J., (2010), “A New Data Set of Educational Attainment in the World, 1950– 2010”, NBER Working Paper No. 15902 (Cambridge, Massachusetts: National Bureau of Economic Research).

Branko, M., (2014). “The return of ‘patrimonial capitalism’: review of Thomas Piketty’s Capital in the 21st century”, Journal of Economic Literature, 52(2), pp. 519-534.

Blas, J., (2014). “Inequality mar Africa’s rise”, Financial Times (October 5th). http://www.ft.com/intl/cms/s/0/9e74aa50-1e4d-11e4-ab52-00144feabdc0.html#axzz3GWsY4I91 (Accessed: 18/10/2014).

Berg, A., & Ostry, J. D., (2011a), “Inequality and Unsustainable Growth: Two Sides of the Same Coin?” IMF Staff Discussion Note 11/08 (Washington: International Monetary Fund).

Berg, A., & Ostry, J. D., (2011b), “Equality and Efficiency,” Finance & Development, International Monetary Fund, September 2011, 48(3), pp. 12-15.

Calderon C., & Servén, L., (2004), “The Effects of Infrastructure Development on Growth and Income Distribution,” World Bank Policy Research Working Paper 3400, Washington.

Commission on Growth and Development (2008), Growth Report: Strategies for Sustained Growth and Inclusive Development (Washington: World Bank).

Congdon, T., (2014), “What were the causes of the great recession? The mainstream approach versus a monetary interpretation”, World Economics, 15(2), pp. 1-32.

Costantini, M., & Lupi, C., (2005). “Stochastic Convergence among European Economies”, Economics Bulletin, 3(38), pp.1-17.

Dollar, D., Kleineberg, T., & Kraay, A., (2013), “Growth is Still Good for the Poor,” World Bank Policy Research Working Paper No. 6568 (Washington: World Bank).

Dollar, D., Kleineberg, T., & Kraay, A., (2002). “Growth is Good for the Poor,” Journal of Economic Growth, 7(3), pp. 195-225.

Dollar, D., & Kraay, A., (2003), “Institutions, Trade, and Growth,” Journal of Monetary Economics, 50, (1), pp. 133-162.

Elu J., & Loubert, L. (2013). “Earnings Inequality and the Intersectionality of Gender and Ethnicity In SubSaharan Africa: The Case of Tanzanian Manufacturing”, American Economic Review, Papers and Proceedings 04/2013, 103(103), pp. 289-292.

Fosu, A. K., (2015). “Growth, Inequality and Poverty in Sub-Saharan Africa: Recent Progress in a Global Context”, Oxford Development Studies, 43(1), pp. 44-59.

Fosu, A. K., (2008). “Inequality and the Growth-Poverty Nexus: Specification Empirics Using African Data”, Applied Economics Letters, 15(7), pp. 563-566.

Fosu, A. K., (2009). “Inequality and the Impact of Growth on Poverty: Comparative Evidence for Sub-Saharan Africa”, Journal of Development Studies, 45(5), pp. 726-745.

Fosu, A. K., (2010a). “The Effect of Income Distribution on the Ability of Growth to Reduce Poverty: Evidence from Rural and Urban African Economies”, American Journal of Economics and Sociology, 69(3), pp. 1034-1053.

Fosu, A. K., (2010b). “Does Inequality Constrain Poverty Reduction Programs? Evidence from Africa”, Journal of Policy Modeling, 32(6), pp. 818-827.

Fosu, A. K., (2010c). “Inequality, Income and Poverty: Comparative Global Evidence”, Social Sciences Quarterly, 91(5), pp. 1432-1446.

Fosu, A. K., (2011). “Growth, Inequality and Poverty Reduction in Developing Countries: Recent Global Evidence”, UNU WIDER Working Paper 2011/01, Helsinki.

Fosu, A. K., (2001). “Political instability and economic growth in developing economies: some specification empirics”, Economics Letters, 70(2), pp. 289-294.

Franco, A., Malhotra, N., & Simonovits, G., (1991). “Publication Bias in the Social Sciences: Unlocking the File Drawer”, Department of Political Science, Stanford University, Stanford, CA, http://web.stanford.edu/~neilm/malhotra.pdf (Accessed: 28/12/2014).

Franses, P. H., (2002). A Concise Introduction to Econometrics. Cambridge: Cambridge University Press.

Granger, C. W. J., (1999). Empirical Modeling in Economics: Specification and Evaluation. Cambridge: Cambridge University Press.

Hausmann, R.,,Hwang , J., & Rodrik, D., (2007), “What You Export Matters,” Journal of Economic Growth, 12(1), pp. 1-25.

Hansen, N-J. H., & Sulla, O., (2013), “Credit Growth in Latin America: Financial Development or Credit Boom?”, IMF Working Paper No. 13/106, Helsinki.

Homburg, S., (2014). “Critical Remarks on Piketty's 'Capital in the Twenty-first Century' ” Discussion Paper, Wirtschaftswissenschaftliche Fakultät, Leibniz Universität Hannover, No. 530.

Ianchovichina, E., & Gable, S. L., (2012), “What is Inclusive Growth?” in Commodity Prices and Inclusive Growth in Low-Income Countries, ed. by Rabah Arezki, Catherine Pattillo, Marc Quintyn, and Min Zhu, International Monetary Fund.

IMF (2007), “Globalization and Inequality,” World Economic Outlook, Chapter 4, October, Washington DC.

Kraay, A., (2004), “When is Growth Pro-Poor? Cross-Country Evidence,” IMF Working Paper No. 04/47, Washington.

Krusell, P., & Smith, T., (2014). “Is Piketty’s ‘Second Law of Capitalism’ Fundamental?”, Institute for International Economic Studies, CEPR and NBER, http://www.iepecdg.com.br/uploads/artigos/piketty1.pdf (Accessed: 02/09/2014).

Kuznets, S. (1955). “Economic Growth and Income Inequality”. American Economic Review , 45(1), pp. 1–28.

Kuznets, S., (1971). Economic Growth of Nations: Total Output and Production Structure. Belknap Press/Harvard University Press: Cambridge (Mass).

Levine, R., (2005). “Finance and Growth: Theory and Evidence,” Philippe Aghion & Steven Durlauf (eds.), Handbook of Economic Growth, Edition 1, Volume 1, chapter 12, pp. 865–934.

Lewis, A., (1955). Theory of Economic Growth. Milton Park: Routledge.

Lopéz, J. H., (2004). “Pro-growth, Pro-poor: Is There a Tradeoff?”, World Bank Publications.

Martinez, M., & Mlachila, M., (2013), “The Quality of the Recent High-Growth Episode in Sub-Saharan Africa,” IMF Working Paper 13/53 (Washington: International Monetary Fund).

Milanovic, B., (2010), “Haves and the Have-Nots: A Brief and Idiosyncratic History of Global Inequality,”Basic Books.

Mishra, S., Gable, S. L., & Anand, R., (2011), “Service Export Sophsitication and Economic Growth,” World Bank Policy Working Paper No. 5606, Washington.

Mlachila, M., Tapsoba, R., & Tapsoba, S. J. A., (2014). “A Quality of Growth Index for Developing Countries: A Proposal”, IMF Working Paper No. 14/172, Washington.

Narayan, P. K., Mishra, S., & Narayan, S., (2011). “Do market capitalization and stocks traded converge? New global evidence”, Journal of Banking and Finance, 35(10), pp. 2771-2781.

Ncube, M., Anyanwu, J. C., & Hausken, K., (2014). “Inequality, Economic Growth and Poverty in the Middle East and North Africa (MENA)”, African Development Review, 26(3), pp. 435-453.

Odhiambo, N. M., (2013). “Is financial development pro-poor or pro-rich? Empirical evidence from Tanzania”, Journal of Development Effectiveness, 5(4), pp. 489-500.

Odhiambo, N. M., (2011). “Growth, Employment and Poverty in South Africa: In Search of a Trickle-Down Effect”, Journal of Income Distribution, 20(1), pp. 49-62.

Odhiambo, N. M., (2010a). “Financial deepening and poverty reduction in Zambia: an empirical investigation”, International Journal of Social Economics, 37(1), pp. 41-53.

Odhiambo, N. M., (2010a). “Is financial development a spur to poverty reduction? Kenya's experience”, Journal of Economic Studies, 37(3), pp. 343-353.

Odhiambo, N. M., (2009). “Finance-growth-poverty nexus in South Africa: A dynamic causality linkage”, Journal of Behavioral and Experimental Economics, 38(2), pp. 320-325.

Ola-David, O., & Oyelaran-Oyeyinka, O., (2014). “Smart Economics: Inclusive Growth, Poverty Alleviation and Decent Employment in Nigeria”, SSRN Working Paper http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2505264 (Accessed: 30/12/2014).

Olise, M. C., Anigbogu, T. U., Okoli, M. I., & Anyanwu, K. N., (2013). “Domestic Investment and Foreign Direct Investment Flows In Nigeria”, IOSR Journal Of Humanities And Social Science, 13(6), pp. 1-12.

Piketty, T., (2014). “Capital in the Twenty First Century”, Harvard University Press.

Pinkivskiy, M., & Sala-i-Martin, X., (2014). “Africa is on time”, Journal of Economic Growth, 19(3), pp. 311-333.

Ravallion, M., & Chen, S., (2003), “Measuring Pro-Poor Growth,” Economics Letters, 78(1), pp. 93-99.

Reynolds, A., (2014). “Why Piketty’s Wealth Data Are Worthless”, CATO INSTITUTE, http://www.cato.org/publications/commentary/why-pikettys-wealth-data-are-worthless?utm_source=dlvr.it&utm_medium=twitter&utm_campaign=Feed%3A+CatoRecentOpeds+(Cato+Recent+Op-eds) (Accessed: 02/09/2014).

Rosenberg, M. S., (2005). “The file-drawer problem revisited: a general weighted method for calculating fail-safe numbers in meta-analysis”, Evolution, 59(2), pp. 464-468.

Sala-i-Martin, X., (2006), “The World Distribution of Income: Falling Poverty and Convergence Period”, The Quarterly Journal of Economics, MIT Press, 121(2), pp. 351–97.

Seneviratne, D., & Sun, Y., (2013), “Infrastructure and Income Distribution in ASEAN-5: What are the Links?” IMF Working Paper No. 13/41, Washington.

Stiglitz, J.E., (2014). “Democracy in the Twenty-First Century”, Project Syndicate. http://www.project-syndicate.org/commentary/joseph-e--stiglitz-blames-rising-inequality-on-an-ersatz-form-of-capitalism-that-benefits-only-the-rich#8fX6aHZR7H3oqmHF.99 (Accessed: 02/09/2014).

Summers, L. H., (1991). “The Scientific Illusion in Empirical Macroeconomics”, The Scandinavian Journal of Economics, Vol. 93, No. 2, Proceedings of a Conference on New Approaches to Empirical Macroeconomics. (Jun., 1991), pp. 129-148.

Thorbecke, E., (2013). “The Interrelationship Linking Growth, Inequality and Poverty in Sub-Saharan Africa”, Journal of African Economies, 33, Suppl_1, pp. 15-48.

Young, A., (2012). “The African growth miracle”, Journal of Political Economy, 120 (4), pp. 696-739.