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Towards The Quest To Reduce Income Inequality In Africa: Is There A Synergy Between Tourism Development And Governance?

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  • Isaac K. Ofori

    (University of Insubria, Varese, Italy)

  • Toyo A. M. Dossou

    (Chengdu, China)

  • Seyi S. Akadiri

    (Central Bank of Nigeria, Abuja, Nigeria)

Abstract

Despite the growing attention on the tourism development-income inequality nexus, a conspicuous gap in the literature is that rigorous empirical works examining how good governance moderates the relationship is hard to find. Anchoring on the trickle-down theory and the tourism-led growth hypothesis, this study fills this void in the literature based on data for 48 African countries for the period 1996 – 2020. We provide strong evidence robust to several specifications from the GMM estimator to show that, though unconditionally, both tourism development and governance reduce income inequality in Africa, the effect of the former is amplified in the presence of quality economic, political and institutional governance. Particularly, we find that control of corruption and political stability are keys for propelling Africa’s tourism sector to contribute to shared income distribution across the continent. Policy recommendations are provided in line with SDG 10 and Aspirations 1 and 3 of Africa’s Agenda 2063.

Suggested Citation

  • Isaac K. Ofori & Toyo A. M. Dossou & Seyi S. Akadiri, 2021. "Towards The Quest To Reduce Income Inequality In Africa: Is There A Synergy Between Tourism Development And Governance?," Research Africa Network Working Papers 21/092, Research Africa Network (RAN).
    • Handle: RePEc:abh:wpaper:21/092
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    Cited by:

    1. Samba Diop & Simplice A. Asongu & Vanessa S. Tchamyou, 2021. "Mitigating the Macroeconomic Impact of Severe Natural Disasters in Africa: Policy Synergies," Working Papers 21/094, European Xtramile Centre of African Studies (EXCAS).
    2. Nchofoung, Tii N. & Asongu, Simplice A., 2022. "ICT for sustainable development: Global comparative evidence of globalisation thresholds," Telecommunications Policy, Elsevier, vol. 46(5).
    3. Charles S. Saba & Simplice A. Asongu & Nicholas Ngepah & Yolande E. Ngoungou, 2023. "Governance in the exploration of global and regional determinants of ICT development," Working Papers of the African Governance and Development Institute. 23/040, African Governance and Development Institute..
    4. Toyo Amègnonna Marcel Dossou, 2023. "Income Inequality in Africa: Exploring the Interaction Between Urbanization and Governance Quality," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 167(1), pages 421-450, June.
    5. Dossou, Toyo Amègnonna Marcel & Ndomandji Kambaye, Emmanuelle & Asongu, Simplice A. & Alinsato, Alastaire Sèna & Berhe, Mesfin Welderufael & Dossou, Kouessi Pascal, 2023. "Foreign direct investment and renewable energy development in sub-saharan Africa: Does governance quality matter?," Renewable Energy, Elsevier, vol. 219(P1).
    6. Toyo A. M. Dossou & Dossou K. Pascal & Emmanuelle N. Kambaye & Simplice A. Asongu & Alastaire S. Alinsato, 2024. "The Financial development-renewable energy consumption nexus in Africa: Does governance quality matter?," Working Papers of the African Governance and Development Institute. 24/020, African Governance and Development Institute..

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    More about this item

    Keywords

    Africa; Corruption; Governance; Income Inequality; Tourism Development; Tourism Receipts;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • L5 - Industrial Organization - - Regulation and Industrial Policy
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa
    • Z32 - Other Special Topics - - Tourism Economics - - - Tourism and Development

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