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Liberalisation and poverty in Africa since 1990-Why is the operation of the 'invisible hand' uneven?

  • Paul Mosley

    (Department of Economics, University of Sheffield UK)

  • Blessing Chiripanhura

    (Office for National Statistics, Newport, Wales, UK)

The dramatic reduction in poverty in Uganda and Ghana in the 1990s was derived largely from the liberalisation of the export price received by a labour-intensive peasant export sector. Other African economies ought to be able to derive inspiration from this manifestation of the invisible hand, but can they? Several other African peasant export economies experienced price liberalisation during the structural adjustment period, but without experiencing anything like the same positive poverty reduction dynamic. Two reasons are fairly clear-liberalising countries varied in the extent to which they passed on higher export prices, and they also varied in the extent to which they impacted on dimensions of governance, especially the politics of market access, in the rest of the economy. The latter continues to be an important research frontier for future investigators. Copyright © 2009 John Wiley & Sons, Ltd.

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Article provided by John Wiley & Sons, Ltd. in its journal Journal of International Development.

Volume (Year): 21 (2009)
Issue (Month): 6 ()
Pages: 749-756

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Handle: RePEc:wly:jintdv:v:21:y:2009:i:6:p:749-756
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  1. Sachs, Jeffrey D & Warner, Andrew M, 1997. "Sources of Slow Growth in African Economies," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 6(3), pages 335-76, October.
  2. Francisco Rodriguez & Dani Rodrik, 1999. "Trade Policy and Economic Growth: a Skeptic's Guide to the Cross-National Evidence," Working Papers 9912, Economic Research Forum, revised Apr 1999.
  3. L. Alan Winters, 2000. "Trade Liberalisation and Poverty," PRUS Working Papers 07, Poverty Research Unit at Sussex, University of Sussex.
  4. John Matovu & Duanjie Chen & Ritva Reinikka-Soininen, 2001. "A Quest for Revenue and Tax Incidence in Uganda," IMF Working Papers 01/24, International Monetary Fund.
  5. David H. Romer & Jeffrey A. Frankel, 1999. "Does Trade Cause Growth?," American Economic Review, American Economic Association, vol. 89(3), pages 379-399, June.
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