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African Growth, Non-Linearities and Strong Dependence: An Empirical Study

Author

Listed:
  • Luis Alberiko Gil-Alaña

    (Navarra Center for International Development)

  • Borja Balprad
  • Guglielmo Maria Caporale

Abstract

The aim of this paper is to examine the behaviour of GDP growth in various African countries allowing for possible non-linearities that are particularly relevant in their case since they have been affected by various conflicts. Specifically, first we carry out standard unit root tests and then follow an approach that combines fractional integration and non-linearities (modelled using Chebyshev polynomials) in a single framework. The results for a sample of 28 countries confirm the existence of non-linearities in most cases, the only exceptions being the Central African Republic, Niger, Sierra Leone and Somalia. Further, there is heterogeneity across countries in terms of the degree of persistence, the GDP series being characterised in different cases by mean reversion, unit root behaviour, and orders of integration significantly higher than 1 respectively. The policy implications of the empirical analysis are also discussed, namely whether or not activist policies are required.

Suggested Citation

  • Luis Alberiko Gil-Alaña & Borja Balprad & Guglielmo Maria Caporale, 2015. "African Growth, Non-Linearities and Strong Dependence: An Empirical Study," NCID Working Papers 12/2015, Navarra Center for International Development, University of Navarra.
    • Handle: RePEc:nva:unnvaa:wp12-2015
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    References listed on IDEAS

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    More about this item

    Keywords

    GDP growth; African countries; non-linearities; Fractional integration; Chebyshev polynomials;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General

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