Metals or Management? Explaining Africa's Recent Economic Growth Spurt
Laura Nyantung Beny
University of Michigan Law School
Lisa D. Cook
Michigan State University - Department of Economics and James Madison College
January 20, 2009
American Economic Review, Forthcoming
U of Michigan Public Law Working Paper No. 136
This article seeks to explain Africa's current "period of unparalleled economic success," following decades of economic stagnation. Using newly available data, we investigate whether international commodity price increases (our "metals" hypothesis) or policy reforms (our "management" hypothesis) have driven Africa's recent reversal of economic fortune. Using cross-country growth analysis, we find that both "metals" and "management" have played a role. Because commodity booms are typically followed by commodity busts, better economic management may be critical for sustaining Africa's economic gains, particularly in the face of the present global economic crisis. We thus invite a reexamination of our "management" and "metals" hypotheses after a few years, when new data are available and the crisis has evolved.
Number of Pages in PDF File: 13
Keywords: Africa, economic growth, economic policy reform, commodities trade, Dutch disease, cross country growth
JEL Classification: A10, E60, F00, F30, O11, O13, O20, O40, O55
Date posted: January 21, 2009 ; Last revised: January 25, 2009
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