Drivers of Growth: Evidence from Sub-Saharan African Countries

Author/Editor:

Manuk Ghazanchyan ; Janet Gale Stotsky

Publication Date:

November 22, 2013

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This study examines the drivers of growth in Sub-Saharan African countries, using aggregate data, from the past decade. We correlate recent growth experience to key determinants of growth, including private and public investment, government consumption, the exchange regime and real exchange rate, and current account liberalization, using various econometric methodologies, including fixed and random effects models, with cluster-robust standard errors. We find that, depending on the specification, higher private and public investments boost growth. Some evidence is found that government consumption exerts a drag on growth and that more flexible exchange regimes are beneficial to growth. The real exchange rate and liberalization variables are not significant.

Series:

Working Paper No. 2013/236

Subject:

Exchange rate arrangements Foreign exchange National accounts Private investment Real effective exchange rates Real exchange rates

English

Publication Date:

November 22, 2013

ISBN/ISSN:

9781475516487/1018-5941

Stock No:

WPIEA2013236

Pages:

38

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