IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/95602.html
   My bibliography  Save this paper

Diversification des exportations, investissements directs étrangers et croissance économique en Afrique Subsaharienne
[Export diversification, foreign direct investment and economic growth in Sub-Saharan Africa]

Author

Listed:
  • NAPO, Fousséni
  • ADJANDE, Ali Awountchou

Abstract

The objective of this article is to analyse the effects of export diversification and foreign direct investment (FDI) on economic growth. Second, to examine whether foreign direct investment (FDI) can contribute to export diversification. We have adopted a methodology based on the generalized moments method in dynamic panel system over the period 1990-2014 for forty-seven (47) sub-Saharan African countries. The results of our estimates show a positive impact of export diversification on economic growth. This positive impact would be greater through the number of export lines that sub-Saharan African countries will create. On the other hand, the concentration of exports based on raw materials and manufactured value added have a negative impact on GDP per capita growth. This negative effect is due to the concentration of FDI in the raw materials sector. It would therefore make sense for sub-Saharan African countries to diversify FDI in several sectors, which will allow them to create a larger number of potential export lines for growth.

Suggested Citation

  • NAPO, Fousséni & ADJANDE, Ali Awountchou, 2019. "Diversification des exportations, investissements directs étrangers et croissance économique en Afrique Subsaharienne [Export diversification, foreign direct investment and economic growth in Sub-S," MPRA Paper 95602, University Library of Munich, Germany, revised 08 Jun 2019.
  • Handle: RePEc:pra:mprapa:95602
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/95602/1/MPRA_paper_95602.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-1037, October.
    2. Klinger, Bailey & Lederman, Daniel, 2006. "Diversification, innovation, and imitation inside the Global Technological Frontier," Policy Research Working Paper Series 3872, The World Bank.
    3. Anthony P. Thirlwall, 2011. "The Balance of Payments Constraint as an Explanation of International Growth Rate Differences," PSL Quarterly Review, Economia civile, vol. 64(259), pages 429-438.
    4. Jarreau, Joachim & Poncet, Sandra, 2012. "Export sophistication and economic growth: Evidence from China," Journal of Development Economics, Elsevier, vol. 97(2), pages 281-292.
    5. Julian di Giovanni & Andrei A. Levchenko, 2012. "The Risk Content of Exports: A Portfolio View of International Trade," NBER International Seminar on Macroeconomics, University of Chicago Press, vol. 8(1), pages 97-151.
    6. Claudio Bravo-Ortega & Manuel Agosin Trumper, 2007. "The Emergence Of New Successful Export Activities In Latin America: The Case Of Chile," Working Papers wp236, University of Chile, Department of Economics.
    7. Szirmai, Adam & Verspagen, Bart, 2015. "Manufacturing and economic growth in developing countries, 1950–2005," Structural Change and Economic Dynamics, Elsevier, vol. 34(C), pages 46-59.
    8. Ricardo Hausmann & Jason Hwang & Dani Rodrik, 2007. "What you export matters," Journal of Economic Growth, Springer, vol. 12(1), pages 1-25, March.
    9. Raymond Vernon, 1966. "International Investment and International Trade in the Product Cycle," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 80(2), pages 190-207.
    10. Julian di Giovanni & Andrei A. Levchenko, 2009. "Trade Openness and Volatility," The Review of Economics and Statistics, MIT Press, vol. 91(3), pages 558-585, August.
    11. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 407-437.
    12. Matsuyama, Kiminori, 1992. "Agricultural productivity, comparative advantage, and economic growth," Journal of Economic Theory, Elsevier, vol. 58(2), pages 317-334, December.
    13. Jean Imbs & Romain Wacziarg, 2003. "Stages of Diversification," American Economic Review, American Economic Association, vol. 93(1), pages 63-86, March.
    14. Atish R. Ghosh & Jonathan D. Ostry, 1994. "Export Instability and the External Balance in Developing Countries," IMF Staff Papers, Palgrave Macmillan, vol. 41(2), pages 214-235, June.
    15. Acemoglu, Daron & Zilibotti, Fabrizio, 1997. "Was Prometheus Unbound by Chance? Risk, Diversification, and Growth," Journal of Political Economy, University of Chicago Press, vol. 105(4), pages 709-751, August.
    16. repec:hoo:wpaper:e-92-3 is not listed on IDEAS
    17. Jörg MAYER, 1996. "Implications Of New Trade And Endogenous Growth Theories For Diversification Policies Of Commodity-Dependent Countries," UNCTAD Discussion Papers 122, United Nations Conference on Trade and Development.
    18. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
    19. Lall, Sanjaya & Weiss, John & Zhang, Jinkang, 2006. "The "sophistication" of exports: A new trade measure," World Development, Elsevier, vol. 34(2), pages 222-237, February.
    20. Sachs, J-D & Warner, A-M, 1995. "Natural Resource Abundance and Economic Growth," Papers 517a, Harvard - Institute for International Development.
    21. Xavier Sala-I-Martin & Gernot Doppelhofer & Ronald I. Miller, 2004. "Determinants of Long-Term Growth: A Bayesian Averaging of Classical Estimates (BACE) Approach," American Economic Review, American Economic Association, vol. 94(4), pages 813-835, September.
    22. Hausmann, Ricardo & Rodrik, Dani, 2003. "Economic development as self-discovery," Journal of Development Economics, Elsevier, vol. 72(2), pages 603-633, December.
    23. Sachs, Jeffrey D. & Warner, Andrew M., 2001. "The curse of natural resources," European Economic Review, Elsevier, vol. 45(4-6), pages 827-838, May.
    24. Federico Bonaglia & Kiichiro Fukasaku, 2003. "Export Diversification in Low-Income Countries: An International Challenge After Doha," OECD Development Centre Working Papers 209, OECD Publishing.
    25. Guillaumont, Patrick & Jeanneney, Sylviane Guillaumont & Brun, Jean-Francois, 1999. "How Instability Lowers African Growth," Journal of African Economies, Centre for the Study of African Economies, vol. 8(1), pages 87-107, March.
    26. Klinger, Bailey & Lederman, Daniel, 2004. "Discovery and development : an empricial exploration of"new"products," Policy Research Working Paper Series 3450, The World Bank.
    27. Jean-Claude Berthelémy & Sophie Chauvin, 2000. "Structural Changes in Asia and Growth Prospects After the Crisis," Working Papers 2000-09, CEPII research center.
    28. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    29. William Easterly & Ross Levine, 1997. "Africa's Growth Tragedy: Policies and Ethnic Divisions," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 112(4), pages 1203-1250.
    30. Ricardo Hausmann & Bailey Klinger, 2007. "The Structure of the Product Space and the Evolution of Comparative Advantage," CID Working Papers 146, Center for International Development at Harvard University.
    31. Szirmai, Adam, 2009. "Industrialisation as an engine of growth in developing countries," MERIT Working Papers 2009-010, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    32. Francisco Rodríguez & Dani Rodrik, 2001. "Trade Policy and Economic Growth: A Skeptic's Guide to the Cross-National Evidence," NBER Chapters, in: NBER Macroeconomics Annual 2000, Volume 15, pages 261-338, National Bureau of Economic Research, Inc.
    33. Krugman, Paul R, 1981. "Intraindustry Specialization and the Gains from Trade," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 959-973, October.
    34. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    35. Fahim Al-Marhubi, 2000. "Export diversification and growth: an empirical investigation," Applied Economics Letters, Taylor & Francis Journals, vol. 7(9), pages 559-562.
    36. Abhijit Sharma & Theodore Panagiotidis, 2005. "An Analysis of Exports and Growth in India: Cointegration and Causality Evidence (1971–2001)," Review of Development Economics, Wiley Blackwell, vol. 9(2), pages 232-248, May.
    37. Ali, Ridwan & Alwang, Jeffrey & Siegel, Paul B., 1991. "Is export diversification the best way to achieve export growth and stability? A look at three African countries," Policy Research Working Paper Series 729, The World Bank.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Dalila NICET- CHENAF (GREThA-GRES) & Eric ROUGIER (GREThA-GRES), 2008. "Recent exports matter: export discoveries, FDI and Growth, an empirical assessment for MENA countries," Cahiers du GRES (2002-2009) 2008-17, Groupement de Recherches Economiques et Sociales.
    2. Hailu, Degol & Kipgen, Chinpihoi, 2017. "The Extractives Dependence Index (EDI)," Resources Policy, Elsevier, vol. 51(C), pages 251-264.
    3. Aye Mengistu, Alemu, 2009. "Determinants of Vertical and Horizontal Export Diversification: Evidences from Sub-Saharan Africa and East Asia," Ethiopian Journal of Economics, Ethiopian Economics Association, vol. 17(2), pages 107-107, August.
    4. Heiko Hesse, 2008. "Export Diversification and Economic Growth," World Bank Publications - Books, The World Bank Group, number 28040, December.
    5. Felipe Starosta de Waldemar, 2010. "How costly is rent-seeking to diversification: an empirical approach," Documents de travail du Centre d'Economie de la Sorbonne 10008, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    6. Wenni Lei & Yuwei Luo, 2022. "Institutions Rule in Export Diversity," Sustainability, MDPI, vol. 14(18), pages 1-14, September.
    7. Capolupo, Rosa, 2009. "The New Growth Theories and Their Empirics after Twenty Years," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 3, pages 1-72.
    8. Asier Minondo, 2011. "Does comparative advantage explain countries’ diversification level?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 147(3), pages 507-526, September.
    9. Oasis Kodila†Tedika & Simplice A. Asongu, 2018. "Does Intelligence Affect Economic Diversification?," German Economic Review, Verein für Socialpolitik, vol. 19(1), pages 74-93, February.
    10. Lectard, Pauline & Rougier, Eric, 2018. "Can Developing Countries Gain from Defying Comparative Advantage? Distance to Comparative Advantage, Export Diversification and Sophistication, and the Dynamics of Specialization," World Development, Elsevier, vol. 102(C), pages 90-110.
    11. Roberto Basile & Aleksandra Parteka & Rosanna Pittiglio, 2018. "Export diversification and economic development: A dynamic spatial data analysis," Review of International Economics, Wiley Blackwell, vol. 26(3), pages 634-650, August.
    12. Regolo, Julie, 2017. "Manufacturing export diversification and regionalization of trade: Which destinations for newly exported goods?," International Economics, Elsevier, vol. 151(C), pages 26-47.
    13. Yu Ri Kim, 2019. "Does aid for trade diversify the export structure of recipient countries?," The World Economy, Wiley Blackwell, vol. 42(9), pages 2684-2722, September.
    14. Xavier Cirera & Anabel Marin & Ricardo Markwald, 2011. "Explaining the Diversification Path of Exporters in Brazil: How Similar and Sophisticated are New Products?," Working Paper Series 2611, Department of Economics, University of Sussex Business School.
    15. Iyoboyi, Martins, 2019. "Macroeconomic Analysis of Export Diversification in Nigeria," Empirical Economic Review, Department of Economics and Statistics, Dr Hassan Murad School of Management, University of Management and Technology, Lahore, vol. 2(1), pages 83-116.
    16. Arvanitidis, Paschalis & Petrakos, George & Pavleas, Sotiris, 2007. "Determinants of economic growth: the experts’ view," Papers DYNREG20, Economic and Social Research Institute (ESRI).
    17. Ana Paula Ribeiro & Vitor Carvalho & Paula Santos, 2016. "Export-Led Growth in the EU: Where and What to Export?," The International Trade Journal, Taylor & Francis Journals, vol. 30(4), pages 319-344, August.
    18. Grundmann, Rainer & Gries, Thomas, 2015. "Crucial for Modern Sector Development? The Role of Exports and Institutions in Developing Countries," VfS Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 112962, Verein für Socialpolitik / German Economic Association.
    19. Young Ademola Obafemi, 2022. "Specialization Versus Diversification as Alternative Strategies for Sustainable Growth in Resource-Rich Developing Countries. Case of Nigeria," Studia Universitatis „Vasile Goldis” Arad – Economics Series, Sciendo, vol. 32(3), pages 1-47, September.
    20. Carlos A. Carrasco & Edgar Demetrio Tovar-García, 2021. "Trade and growth in developing countries: the role of export composition, import composition and export diversification," Economic Change and Restructuring, Springer, vol. 54(4), pages 919-941, November.

    More about this item

    Keywords

    Africa; exports; diversification and natural resources.;
    All these keywords.

    JEL classification:

    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa
    • P33 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - International Trade, Finance, Investment, Relations, and Aid

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:95602. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.