Explaining Africa’s (Dis)advantage : The Curse of Party Monopoly
Africa's economic performance has been widely viewed with pessimism. This paper uses firm-level data for 89 countries to examine formal firm performance. Without controls, manufacturing African firms do not perform much worse than firms in oth...
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| Format: | Policy Research Working Paper |
| Language: | English en_US |
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World Bank, Washington, DC
2013
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| Online Access: | http://documents.worldbank.org/curated/en/2013/01/17172552/explaining-africas-disadvantage-curse-party-monopoly http://hdl.handle.net/10986/12177 |
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okr-10986-12177 |
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| recordtype |
oai_dc |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English en_US |
| topic |
ACCOUNTING ADVERSE EFFECT ADVERSE EFFECTS AGENCY PROBLEMS AUTOMOBILE BANK LOANS BARRIER BENCHMARK BENCHMARKING BINDING CONSTRAINTS BUSINESS CLIMATE BUSINESS ENVIRONMENT BUSINESS ENVIRONMENTS BUSINESS REGULATION BUSINESSES CAPITAL ALLOCATION CAPITAL INTENSITY CAPITAL STOCK COLLECTIVE ACTION COMMUNICATION INFRASTRUCTURE COMPARATIVE ADVANTAGE COMPARATIVE ECONOMICS COMPETITIVENESS CONTRACT ENFORCEMENT CONVENTIONAL INSTRUMENTS CUSTOM DEMOCRACY DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DIRECT FOREIGN INVESTMENT DIVISION OF LABOR DOMESTIC COMPETITION DOMESTIC MARKET ECONOMETRICS ECONOMIC BEHAVIOR ECONOMIC DEVELOPMENT ECONOMIC EFFICIENCY ECONOMIC GROWTH ECONOMIC OUTCOMES ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC RESEARCH ECONOMICS EFFICIENCY IMPROVEMENT ELECTRICITY EMPIRICAL ANALYSIS EMPIRICAL STUDIES EMPLOYMENT GROWTH ENDOGENOUS VARIABLES ENTERPRISE SURVEY ENTERPRISE SURVEYS ENVIRONMENTS EQUIPMENT EXPORTS EXPOSURE EXTERNAL FINANCE FINANCIAL CRISIS FINANCIAL DEVELOPMENT FIRM GROWTH FIRM PERFORMANCE FOREIGN DIRECT INVESTMENT FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN OWNERSHIP GDP GDP PER CAPITA GLOBAL MARKETS GLOBALIZATION GROWTH POTENTIAL GROWTH RATE GROWTH RATES IMPUTATION INCOME INCOME GROUP INCOME LEVELS INDUSTRIALIZATION INEFFICIENCY INFLATION RATE INFORMATION SHARING INFORMATION TECHNOLOGY INNOVATION INPUT USE INSTITUTIONAL ENVIRONMENT INTERNATIONAL COMPETITION INTERNATIONAL MARKET INTERNATIONAL TRADE INVESTMENT CLIMATE JOB CREATION LABOR COSTS LABOR MARKET LABOR MARKET FLEXIBILITY LABOR MARKETS LABOR PRODUCTIVITY LABOR REGULATIONS LEGAL CONSTRAINTS LESS DEVELOPED COUNTRIES MACROECONOMIC PERFORMANCE MACROECONOMIC POLICIES MANAGERIAL DISCRETION MANUFACTURING MANUFACTURING INDUSTRIES MARKET COMPETITION MARKET REGULATION MARKET REGULATIONS MATERIAL MENU MINIMUM WAGES MONITORING MECHANISM MONOPOLY NATURAL RESOURCE NATURAL RESOURCES NETWORK DATA NETWORKS OPEN ACCESS PERFORMANCE INDICATOR PERFORMANCE MEASURE PERFORMANCE MEASURES POLICY MAKERS POLITICAL ECONOMY POLITICAL INSTITUTIONS POLITICAL POWER POSITIVE EFFECTS PRIVATE INVESTMENT PRIVATE SECTOR PRIVATE SECTOR DEVELOPMENT PRIVATIZATION PRODUCERS PRODUCTION FUNCTION PRODUCTIVITY GROWTH PROPERTY RIGHTS REGIONAL TRADE REGULATORS RENTS RESULT RESULTS RETAIL STORES RISK SHARING SAFETY SALES GROWTH SCALE EFFECTS SEVERANCE PAY STRUCTURAL CHANGE SUSTAINABLE GROWTH TAX TAX RATE TAXATION TELECOM TELECOMMUNICATION TELECOMMUNICATIONS TELEPHONE TIME PERIOD TOTAL FACTOR PRODUCTIVITY TRADE BLOCS TRADE FINANCE UNEMPLOYMENT URBANIZATION USES VALUE ADDED WAGE STRUCTURE WAGES WEB WORLD DEVELOPMENT INDICATORS WORLD ECONOMY |
| spellingShingle |
ACCOUNTING ADVERSE EFFECT ADVERSE EFFECTS AGENCY PROBLEMS AUTOMOBILE BANK LOANS BARRIER BENCHMARK BENCHMARKING BINDING CONSTRAINTS BUSINESS CLIMATE BUSINESS ENVIRONMENT BUSINESS ENVIRONMENTS BUSINESS REGULATION BUSINESSES CAPITAL ALLOCATION CAPITAL INTENSITY CAPITAL STOCK COLLECTIVE ACTION COMMUNICATION INFRASTRUCTURE COMPARATIVE ADVANTAGE COMPARATIVE ECONOMICS COMPETITIVENESS CONTRACT ENFORCEMENT CONVENTIONAL INSTRUMENTS CUSTOM DEMOCRACY DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DIRECT FOREIGN INVESTMENT DIVISION OF LABOR DOMESTIC COMPETITION DOMESTIC MARKET ECONOMETRICS ECONOMIC BEHAVIOR ECONOMIC DEVELOPMENT ECONOMIC EFFICIENCY ECONOMIC GROWTH ECONOMIC OUTCOMES ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC RESEARCH ECONOMICS EFFICIENCY IMPROVEMENT ELECTRICITY EMPIRICAL ANALYSIS EMPIRICAL STUDIES EMPLOYMENT GROWTH ENDOGENOUS VARIABLES ENTERPRISE SURVEY ENTERPRISE SURVEYS ENVIRONMENTS EQUIPMENT EXPORTS EXPOSURE EXTERNAL FINANCE FINANCIAL CRISIS FINANCIAL DEVELOPMENT FIRM GROWTH FIRM PERFORMANCE FOREIGN DIRECT INVESTMENT FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN OWNERSHIP GDP GDP PER CAPITA GLOBAL MARKETS GLOBALIZATION GROWTH POTENTIAL GROWTH RATE GROWTH RATES IMPUTATION INCOME INCOME GROUP INCOME LEVELS INDUSTRIALIZATION INEFFICIENCY INFLATION RATE INFORMATION SHARING INFORMATION TECHNOLOGY INNOVATION INPUT USE INSTITUTIONAL ENVIRONMENT INTERNATIONAL COMPETITION INTERNATIONAL MARKET INTERNATIONAL TRADE INVESTMENT CLIMATE JOB CREATION LABOR COSTS LABOR MARKET LABOR MARKET FLEXIBILITY LABOR MARKETS LABOR PRODUCTIVITY LABOR REGULATIONS LEGAL CONSTRAINTS LESS DEVELOPED COUNTRIES MACROECONOMIC PERFORMANCE MACROECONOMIC POLICIES MANAGERIAL DISCRETION MANUFACTURING MANUFACTURING INDUSTRIES MARKET COMPETITION MARKET REGULATION MARKET REGULATIONS MATERIAL MENU MINIMUM WAGES MONITORING MECHANISM MONOPOLY NATURAL RESOURCE NATURAL RESOURCES NETWORK DATA NETWORKS OPEN ACCESS PERFORMANCE INDICATOR PERFORMANCE MEASURE PERFORMANCE MEASURES POLICY MAKERS POLITICAL ECONOMY POLITICAL INSTITUTIONS POLITICAL POWER POSITIVE EFFECTS PRIVATE INVESTMENT PRIVATE SECTOR PRIVATE SECTOR DEVELOPMENT PRIVATIZATION PRODUCERS PRODUCTION FUNCTION PRODUCTIVITY GROWTH PROPERTY RIGHTS REGIONAL TRADE REGULATORS RENTS RESULT RESULTS RETAIL STORES RISK SHARING SAFETY SALES GROWTH SCALE EFFECTS SEVERANCE PAY STRUCTURAL CHANGE SUSTAINABLE GROWTH TAX TAX RATE TAXATION TELECOM TELECOMMUNICATION TELECOMMUNICATIONS TELEPHONE TIME PERIOD TOTAL FACTOR PRODUCTIVITY TRADE BLOCS TRADE FINANCE UNEMPLOYMENT URBANIZATION USES VALUE ADDED WAGE STRUCTURE WAGES WEB WORLD DEVELOPMENT INDICATORS WORLD ECONOMY Harrison, Ann E. Lin, Justin Yifu Xu, L. Colin Explaining Africa’s (Dis)advantage : The Curse of Party Monopoly |
| geographic_facet |
Africa |
| relation |
Policy Research Working Paper; No. 6316 |
| description |
Africa's economic performance has
been widely viewed with pessimism. This paper uses
firm-level data for 89 countries to examine formal firm
performance. Without controls, manufacturing African firms
do not perform much worse than firms in other regions. But
they do have structural problems, exhibiting much lower
export intensity and investment rates. Once the analysis
controls for geography and the political and business
environment, formal African firms robustly lead in sales
growth, total factor productivity levels and productivity
growth. Africa's conditional advantage is higher in
low-tech than in high-tech manufacturing, and exists in
manufacturing but not in services. While geography,
infrastructure, and access to finance play an important role
in explaining Africa's disadvantage in firm
performance, the key factor is party monopoly. The longer a
single political party remains in power, the lower are firm
productivity levels, growth rates, and sales growth for
manufacturing. In contrast, the business environment and
firm characteristics (except for foreign investment) do not
matter as much. The paper also finds evidence that the
effects of the political and business environment are
heterogeneous across sectors and firms of various levels of technology. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Harrison, Ann E. Lin, Justin Yifu Xu, L. Colin |
| author_facet |
Harrison, Ann E. Lin, Justin Yifu Xu, L. Colin |
| author_sort |
Harrison, Ann E. |
| title |
Explaining Africa’s (Dis)advantage : The Curse of Party Monopoly |
| title_short |
Explaining Africa’s (Dis)advantage : The Curse of Party Monopoly |
| title_full |
Explaining Africa’s (Dis)advantage : The Curse of Party Monopoly |
| title_fullStr |
Explaining Africa’s (Dis)advantage : The Curse of Party Monopoly |
| title_full_unstemmed |
Explaining Africa’s (Dis)advantage : The Curse of Party Monopoly |
| title_sort |
explaining africa’s (dis)advantage : the curse of party monopoly |
| publisher |
World Bank, Washington, DC |
| publishDate |
2013 |
| url |
http://documents.worldbank.org/curated/en/2013/01/17172552/explaining-africas-disadvantage-curse-party-monopoly http://hdl.handle.net/10986/12177 |
| _version_ |
1764422160019881984 |
| spelling |
okr-10986-121772021-04-23T14:03:06Z Explaining Africa’s (Dis)advantage : The Curse of Party Monopoly Harrison, Ann E. Lin, Justin Yifu Xu, L. Colin ACCOUNTING ADVERSE EFFECT ADVERSE EFFECTS AGENCY PROBLEMS AUTOMOBILE BANK LOANS BARRIER BENCHMARK BENCHMARKING BINDING CONSTRAINTS BUSINESS CLIMATE BUSINESS ENVIRONMENT BUSINESS ENVIRONMENTS BUSINESS REGULATION BUSINESSES CAPITAL ALLOCATION CAPITAL INTENSITY CAPITAL STOCK COLLECTIVE ACTION COMMUNICATION INFRASTRUCTURE COMPARATIVE ADVANTAGE COMPARATIVE ECONOMICS COMPETITIVENESS CONTRACT ENFORCEMENT CONVENTIONAL INSTRUMENTS CUSTOM DEMOCRACY DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPING ECONOMIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DIRECT FOREIGN INVESTMENT DIVISION OF LABOR DOMESTIC COMPETITION DOMESTIC MARKET ECONOMETRICS ECONOMIC BEHAVIOR ECONOMIC DEVELOPMENT ECONOMIC EFFICIENCY ECONOMIC GROWTH ECONOMIC OUTCOMES ECONOMIC PERFORMANCE ECONOMIC POLICIES ECONOMIC RESEARCH ECONOMICS EFFICIENCY IMPROVEMENT ELECTRICITY EMPIRICAL ANALYSIS EMPIRICAL STUDIES EMPLOYMENT GROWTH ENDOGENOUS VARIABLES ENTERPRISE SURVEY ENTERPRISE SURVEYS ENVIRONMENTS EQUIPMENT EXPORTS EXPOSURE EXTERNAL FINANCE FINANCIAL CRISIS FINANCIAL DEVELOPMENT FIRM GROWTH FIRM PERFORMANCE FOREIGN DIRECT INVESTMENT FOREIGN FIRMS FOREIGN INVESTMENT FOREIGN OWNERSHIP GDP GDP PER CAPITA GLOBAL MARKETS GLOBALIZATION GROWTH POTENTIAL GROWTH RATE GROWTH RATES IMPUTATION INCOME INCOME GROUP INCOME LEVELS INDUSTRIALIZATION INEFFICIENCY INFLATION RATE INFORMATION SHARING INFORMATION TECHNOLOGY INNOVATION INPUT USE INSTITUTIONAL ENVIRONMENT INTERNATIONAL COMPETITION INTERNATIONAL MARKET INTERNATIONAL TRADE INVESTMENT CLIMATE JOB CREATION LABOR COSTS LABOR MARKET LABOR MARKET FLEXIBILITY LABOR MARKETS LABOR PRODUCTIVITY LABOR REGULATIONS LEGAL CONSTRAINTS LESS DEVELOPED COUNTRIES MACROECONOMIC PERFORMANCE MACROECONOMIC POLICIES MANAGERIAL DISCRETION MANUFACTURING MANUFACTURING INDUSTRIES MARKET COMPETITION MARKET REGULATION MARKET REGULATIONS MATERIAL MENU MINIMUM WAGES MONITORING MECHANISM MONOPOLY NATURAL RESOURCE NATURAL RESOURCES NETWORK DATA NETWORKS OPEN ACCESS PERFORMANCE INDICATOR PERFORMANCE MEASURE PERFORMANCE MEASURES POLICY MAKERS POLITICAL ECONOMY POLITICAL INSTITUTIONS POLITICAL POWER POSITIVE EFFECTS PRIVATE INVESTMENT PRIVATE SECTOR PRIVATE SECTOR DEVELOPMENT PRIVATIZATION PRODUCERS PRODUCTION FUNCTION PRODUCTIVITY GROWTH PROPERTY RIGHTS REGIONAL TRADE REGULATORS RENTS RESULT RESULTS RETAIL STORES RISK SHARING SAFETY SALES GROWTH SCALE EFFECTS SEVERANCE PAY STRUCTURAL CHANGE SUSTAINABLE GROWTH TAX TAX RATE TAXATION TELECOM TELECOMMUNICATION TELECOMMUNICATIONS TELEPHONE TIME PERIOD TOTAL FACTOR PRODUCTIVITY TRADE BLOCS TRADE FINANCE UNEMPLOYMENT URBANIZATION USES VALUE ADDED WAGE STRUCTURE WAGES WEB WORLD DEVELOPMENT INDICATORS WORLD ECONOMY Africa's economic performance has been widely viewed with pessimism. This paper uses firm-level data for 89 countries to examine formal firm performance. Without controls, manufacturing African firms do not perform much worse than firms in other regions. But they do have structural problems, exhibiting much lower export intensity and investment rates. Once the analysis controls for geography and the political and business environment, formal African firms robustly lead in sales growth, total factor productivity levels and productivity growth. Africa's conditional advantage is higher in low-tech than in high-tech manufacturing, and exists in manufacturing but not in services. While geography, infrastructure, and access to finance play an important role in explaining Africa's disadvantage in firm performance, the key factor is party monopoly. The longer a single political party remains in power, the lower are firm productivity levels, growth rates, and sales growth for manufacturing. In contrast, the business environment and firm characteristics (except for foreign investment) do not matter as much. The paper also finds evidence that the effects of the political and business environment are heterogeneous across sectors and firms of various levels of technology. 2013-01-28T19:58:11Z 2013-01-28T19:58:11Z 2013-01 http://documents.worldbank.org/curated/en/2013/01/17172552/explaining-africas-disadvantage-curse-party-monopoly http://hdl.handle.net/10986/12177 English en_US Policy Research Working Paper; No. 6316 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Africa |