African Growth: Why a 'Big Push'?

Abstract:     
Over the past 40 years Africa has stagnated while other developing countries have grasped growth opportunities. This process of divergence has turned Africa into the poorest region. Africa needs a big push to escape from four development traps: the conflict trap, the corruption trap, the primary commodity trap and the fractionalized society trap. Since these low level equilibria have been sustained over some time a marginal effort is unlikely to be successful. However, the traps weaken the effectiveness of aid, making increased aid unlikely to be a successful instrument to push Africa's development. This paper suggests four non-traditional policy instruments donors can use in addition to increased aid: a security guarantee, templates of good governance, temporary trade preferences and the conditioning aid on processes of governance rather than on policies.

Accepted Paper Series