Acemoglu, Daron, and Simon Johnson, 2006. “Disease and Development: The Effect of Life Expectancy on Economic Growth,” NBER Working Papers 12269.
Acemoglu, Daron, Simon Johnson and James A. Robinson, 2001, “The Colonial Origins of Comparative Development: An Empirical Investigation,” American Economic Review, Vol. 91, No. 5 (December), pp. 1369–1401.
Besley, Timothy and Torsten Persson, 2007. “The Origins of State Capacity: Property Rights, Taxation, and Politics,” NBER Working Papers 13028.
Blattman, Christopher. Jason Hwang, and Jeffery G. Williamson, 2006, “Winners and Losers in the Commodity Lottery: The Impact of Terms of Trade Growth and Volatility in the Periphery, 1870-1939,” forthcoming, Journal of Development Economics
Bloom, David, David Canning and Jaypee Sevilla, 2003, “The Demographic Dividend: A New Perspective on the Economic Consequences of Population Change,” Rand Publications.
Bloom, David, David Canning and Günther Fink & Jocelyn Finlay, 2007. “Realizing the Demographic Dividend: Is Africa any different?” PGDA Working Papers 2307, Program on the Global Demography of Aging.
Brownbridge, Martin and Emmanuel Tumusiime-Mutebile, 2007, “Aid and Fiscal Deficits: Lessons from Uganda on the Implications for Macroeconomic Management and Fiscal Sustainability” Development Policy Review, Vol. 25 No. 2 (March), pp. 193-213.
Chamon, Marcos, and Michael Kremer, 2006, “Asian Growth and African Development” American Economic Association Papers and Proceeding, May 2006, Vol 96(2), pp. 400-404.
Clemens, Michael, Charles Kenny, and Todd J. Moss (2007), “The trouble with the MDGs: Confronting expectations of aid and development success”, World Development, 35(5): 735-751.
Collier, Paul, 2007, “Growth Strategies for Africa”, paper prepared for the Spence Commission on Economic Growth, Centre for the Study of African Economies, Oxford University.
Collier, Paul and Stephen O’Connell, 2006, “Opportunities and Choice”, Chapter 2, in Political Economy of Economic Growth in Africa, 1960 – 2000, Volume 1, Cambridge University Press.
Easterly, William and Ross Levine, 2002. “Tropics, Germs, and Crops: How Endowments Influence Economic Development,” NBER Working Papers 9106.
Easterly, W., 2006, “Reliving the 50s: the Big Push, Poverty Traps, and Takeoffs in Economic Development” Journal of Economic Growth, Vol. 11(4), pages 289-318.
Easterly, William, 2007, “How the Millennium Development Goals are Unfair to Africa” Professor of Economics, NYU Visiting Scholar, Brookings Institute.
Eifert, P.B., 2007, “Infrastructure and Market Structure In Least-Developed Countries,” mimeo, University of California, Berkeley.
Frankel, Jeffery, 2005. “On the Renminbi: The Choice between Adjustment under a Fixed Exchange Rate and Adjustment under a Flexible Rate,” NBER Working Papers 11274.
Hausmann, Ricardo, Bailey Klinger, and Robert Lawrence, 2008, “Examining Beneficiation,” Center for International Development Working Paper No. 162, Harvard University.
Johnson, Simon, Jonathan D. Ostry, and Arvind Subramanian, 2007, “The Prospects for Sustained Growth in Africa: Benchmarking the Constraints”, IMF Working Paper 07/52.
Jones, Benjamin F. and Benjamin A., Olken, 2005, “The Anatomy of Start-Stop Growth,” Working Paper 1152 (Cambridge, Massachusetts: NBER).
Mkandawire, Thandika, 2005, “Maladjusted African Economies and Globalisation,” Africa Development, Vol. XXX, Nos. 1 & 2, 2005, pp. 1–33
Murphy, Kevin, Andrei Shleifer and Robert Vishny, 1989. “Industrialization and the Big Push,” Journal of Political Economy, University of Chicago Press, vol. 97(5), pages 1003-26, October.
Mwenda, Andrew, 2006, “Foreign Aid and the Weakening of Democratic Accountability in Uganda,” Cato Institute Foreign Policy Briefing No. 88.
Nkusu, Mwanza, 2004. “Financing Uganda’s Poverty Reduction Strategy: Is Aid Causing More Pain Than Gain?” IMF Working Paper 04/170
Prasad, Eswar, Raghuram Rajan, and Arvind Subramanian, 2007, “Foreign Capital and Economic Growth,” Brookings Papers on Economic Activity 1, pp. 153–209.
Pritchett, Lant, 2000, “Understanding Patterns of Economic Growth: Searching for Hills Among Plateaus, Mountains, and Plains,” World Bank Economic Review, pp. 221–50.
Pritchett, Lant, 2007, “Does Learning to Add-up Add-up? The Returns to Schooling in Aggregate Data,” mimeo, Kennedy School of Government, Harvard University.
Rajan, Raghuram, and Arvind Subramanian, 2005, “What Undermines Aid’s Impact on Growth? IMF Working Paper No. No. 126 (Washington: International Monetary Fund).
Rodrik, Dani, Arvind Subramanian and Francesco Trebbi, 2004, “Institutions Rule: The Primacy of Institutions over Geography and Integration in Economic Development.” Journal of Economic Growth 9.2 (June), pp. 131–65.
Rodrik, Dani, 2007, The Real Exchange Rate and Economic Growth: Theory and Evidence, Kennedy School of Government, Harvard University.
Roy, Devesh and Arvind Subramanian, 2001, “Who Can Explain the Mauritian Miracle: Meade, Romer, Sachs, or Rodrik?” IMF Working Papers 01/116.
Sachs, Jeffery, and Andrew Warner, 1995, Economic Reform and the Process of Global Integration, in Brooking Papers on Economic Activity, 1995, Volume 26, Issue 1995-1, pp. 1-118.
Subramanian, Arvind, 2007, The Evolution of Institutions in India and its Relationship with Economic Growth, mimeo, Peterson Institute for International Economics and Center for Global.
Wood, Adrian and Kate Jordan, 2000. “Why Does Zimbabwe Export Manufactures and Uganda Not? Econometrics Meets History,” The Journal of Development Studies, Taylor and Francis Journals, vol. 37(2), pages 91-116, December.
My thanks, without implication, to Michael Atingi-Ego, Robert Corker, Peter Doyle, Dmitry Gershensen, John Green, Louis Kaskende, Steve Kayizzi-Mugerwa, Damoni Kitabire, Mark Plant, and Manrique Saenz for helpful comments on earlier drafts. All remaining errors are mine.
Adam Smith’s turn of phrase.
Accelerations are defined as episodes which satisfy the following conditions over an eight year horizon: per capita growth of greater than 3½ percent; an acceleration in the per-capita growth rate of 2 percentage points or more: and post acceleration output level has to exceed pre-acceleration output level.
The sustained growth (SG) sample and starting dates of growth episodes used in this note are those identified by Johnson, Ostry and Subramanian (2007) and comprise: Chile (1986), China (1978), Dominican Republic (1969), Egypt (1976), Indonesia (1967), Korea (1962), Malaysia (1970), Singapore (1969), Taiwan Province of China (1961), Thailand (1960), Tunisia (1968), and Vietnam (1985).
One point of departure from Johnson et al. is to assign the start of Uganda’s growth episode to its appropriate starting point of circa 1990; they treat growth episodes of the African countries in their sample as having started in the late 1990s.
The first year when positive growth was recorded is actually 1987. But both the economic and statistical filters used by the various authors ensure that the trend is sustained so do not always pick the first year of positive growth as a take-off point
Subramanian (2007) goes as far as to argue “…manufacturing growth is a concomitant, perhaps even a sine qua non of, overall, growth.”
Recent papers in this vein include: Wacziarg and Welch (2003), Hausmann, Pritchett, and Rodrik (2004), Olken and Jones (2005), Easterly (2006), Johnson, Ostry and Subramanian (2007), Berg, Ostry and Zettlemeyer (2007) and Aizenman and Spiegel, 2007.
As with much of the empirics in this paper, the aim is not so much to establish causality but to see if the various bivariate (and occasional multivariate) associations are consistent with the predictions of theory.
Various measures of institutions (instrumented by settler mortality data from Acemoglu, Johnson and Robinson, 2001) were used in these regressions but the results are broadly similar.
Beyond per capita income, infant mortality rates are also influenced by factors such as the distribution of income, maternal education etc. For this exercise, we control for disease burden using data on share of territory affected by malaria, a major cause of mortality in sub-Saharan Africa, as a proxy.
The World Bank governance indicators database has six indicators—voice and accountability, political stability and absence of violence, government effectiveness, regulatory quality, rule of law, and control of corruption. Uganda generally ranks somewhat better than its per capita income level would predict on all of these dimensions, except for political the measure on political stability.
We identify aid here because the volumes involved are so large and the influence on both quantities (savings and investment) and prices (the real exchange rate) seems fairly direct. But other, more subtle and to date only weakly explored factors such as fertility may also be influencing the performance of the tradables sector (Rose, Suppat, and Braude, 2008). In particular, high fertility rates (and thus a higher dependency ratio) generally imply higher lower savings rates as well as greater outlays on nontradables (health and education).
There is a growing body of literature on the deleterious effect of aid on governance, by weakening the social contract between rulers and the electorate (see Rajan and Subramanian, 2005 and Mwenda, 2006). But this is beyond the scope of this paper.
As Nkusu argues, large private capital inflows can also have the same deleterious effect as aid. And exchange rate appreciation pressures in recent months have mainly been due to such inflows.
The foregoing discussion raises an interesting question: has the option of an export-led development strategy (the Asia model, as it were) been closed off for African countries because of their reliance on foreign aid inflows?
Note that these arguments are not an appeal to African exceptionalism. Very similar concerns have also been expressed with respect to Latin America’s experience with reform (Stiglitz, 2003). See also Zettlemeyer, 2007.
Extracts from the monograph can be found at http://www0.gsb.columbia.edu/ipd/pub/Meles-Extracts2-AfTF2.pdf.
And much economic transformation remains in China for it to want to keep its exchange rate competitive for some time to come. The share of the population in rural areas is still very high at around 60 percent.
Another argument for better infrastructure services is that it may be constraining growth (World Bank, 2006). But with economic growth having averaged some 9 percent during 2005-07, it is difficult to think of growth having been constrained.