Economics
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Item Intergovernmental Grant Transfers from Central to Local Levels in Ghana: Does Formula Allocation Prevent Political Influences?(Scholink, 2022) Fumey, A.; Egwaikhide, F. O.; Adeniyi, O. A.This study examines how the district assemblies’ common fund grant is distributed among the local governments in Ghana to ascertain the objectivity of the sharing formula scheme created under the 1992 Constitution. The dynamic GMM panel estimation approach is employed for the empirical analysis with focus on new versus mature democracy and how swing and aligned districts tend to benefit from the distribution. Annual data on the fund disbursements and the election outcomes from 1994 to 2018 for 216 district assemblies is used. The findings reveal that average transfers to each district was GhȻ7.54 million which generally increased by 9.4 percent in election years reflecting the opportunistic behavior of incumbent governments. Swing districts benefited more from the increase than non-swing districts, as the former received 4.3 percent more than the latter. Aligned districts in new democracy received, 2 percent more than non-aligned ones, while it was 4.3 percent more for swing districts in mature democracy. Therefore, the allocation formula is subject to political manipulations hence it is recommended that the unilateral appointment of the fund’s administrator by incumbent Presidents be reviewed in addition to creating autonomous public agencies to be responsible for the allocation formula and the fund administration independently.Item "I Prefer to be Old School and Safe”: Fear of Fraud and Governance of Risk in Nigeria’s Cashless Ecosystem(Charles Sturt University (Faculty of Business, Justice, and Behavioral Sciences), 2023) Tade, O.; Adeniyi, O. A.This article provides insight into the prevalence of fraud in Nigeria’s financial cashless ecosystem and how trust is being built in the system to check the growing menace. It is motivated by two overarching questions: Does fear of fraud constitute an impediment to financial inclusion? How does the existence or otherwise of risk governance mechanisms mediate the nexus between electronic fraud and financial inclusion? Using qualitative methods to probe participants in southwestern Nigeria on these issues, the findings show how fear of fraud, indirect experiences of fraud, and fraud governance shape adoption and behaviour in the Nigerian banking system.Item An Econometric Analysis of Residential Fuel Choice in Nigeria: Application of Access Framework(Inderscience Publishers, 2023) Ogunro, T.; Alaba, O.; Adeniyi, O. A.Despite global calls for a transition to modern energy, Nigerian households continue to face obstacles in accessing clean cooking energy. This paper examines the barriers to household fuel choice in rural and urban areas of Ogun Sate, Nigeria, employing an access framework. Through a cross-sectional study involving 597 households, we examined the factors associated with the selection of household cooking fuel and the access challenges. The framework conceptualises fuel choice as a function of three key access dimensions: affordability, availability, and acceptability, using multinomial logit regression. The findings showed that firewood and kerosene remain Nigeria’s dominant household fuel sources. The results highlight that fuel choice is influenced not only by affordability factors but also by factors related to availability and acceptability. Consequently, the study recommends a comprehensive approach beyond affordability, to ensure modern energy sources are culturally acceptable while establishing secure supply chains towards a more environmentally sustainable energy future.Item Public Debt, Tax and Economic Growth in Sub-Saharan African Countries(Springer Nature, 2023) Adedeji, A. A.; Oyinlola, M. A.; Adeniyi, O. A.This study examines the effect of public debt on the relationship between tax and economic growth in sub-Saharan African countries. Grounded in the extended endogenous growth model, it employs a dynamic fixed-effects model to explore both linear and nonlinear relationships. For the full sample, the linear analysis demonstrates that tax measures contribute positively to economic growth regardless of public debt inclusion. Intriguingly, while public debt on its own has a detrimental effect on growth, its interaction with total taxes exhibits a positive influence. Conversely, the nonlinear approach reveals a negative association between public debt and growth. Moreover, the interaction term indicates that public debt weakly supports the impact of indirect taxes on economic growth while undermining the effectiveness of taxes on goods and services. However, the interactions between pub lic debt and other tax measures are not statistically significant. When considering various country classifications based on income level, fragility, and resource endowment under the linear approach, the study uncovers that several tax measures have a positive and statistically significant direct impact on growth. Furthermore, in low-income countries, public debt has a weaker effect on economic growth compared to that in middle-income countries. Public debt tends to reduce the effectiveness of direct taxes and taxes on income, profits, and capital gains in low-income countries. Conversely, public debt enhances only the effectiveness of indirect taxes in driving economic growth in middle-income countries. Under the nonlinear approach, mixed results are observed. Specifically, public debt predominantly undermines the effectiveness of most tax measures in middle-income countries. The findings across other country classifications also reveal diverse effects of public debt on the tax–growth relationship.Item Dependence Between Foreign Trade Performance and Exchange Rate Volatility: Panel ARDL Approach(Croatian Statistical Association (CSA), 2023) Oyinlola, M.A.; Adeniyi, O. A.; Kumeka, T.The purpose of this study is to analyse the influence of exchange rate shocks on foreign trade (exports and imports) of fifteen economies within the ECOWAS sub region. To accomplish the goal of this paper, Autoregressive Distributed Lag (ARDL) procedure was employed to investigate the impact volatility in the exchange rate market has on foreign trade in both long- and short-term with data between 1980 and 2020. To compute volatility, it relied on the GARCH (1, 1) model which predicted the conditional variances as proxy for volatility. Our empirical results are distinguished into export model and import model, and reveal that volatility in exchange rate influence foreign trade performance (exports and imports) negatively in the short run, though statistically insignificant. The impact however becomes positive in the long run, and statistically significant for the two models. These results signpost that while the volatilities in foreign exchange market appear to deteriorate the international trade of these economies in the short-term, it substantially and significantly causes its improvement in the long-term. Hence, our results validate the J curve effect in the case of these ECOWAS economies. Policy implication from the findings suggests that to develop a robust international trade and ultimate economic growth, it is recommended that policymakers of these economies maintain a short-term stability in their foreign currency markets by way of adopting some intervention measures.Item Intergovernmental Grant Transfers from Central to Local Levels in Ghana: Does Formula Allocation Prevent Political Influences?(Scholink, 2022) Fumey, A.; Egwaikhide, F. O.; Adeniyi, O. A.This study examines how the district assemblies’ common fund grant is distributed among the local governments in Ghana to ascertain the objectivity of the sharing formula scheme created under the 1992 Constitution. The dynamic GMM panel estimation approach is employed for the empirical analysis with focus on new versus mature democracy and how swing and aligned districts tend to benefit from the distribution. Annual data on the fund disbursements and the election outcomes from 1994 to 2018 for 216 district assemblies is used. The findings reveal that average transfers to each district was GhȻ7.54 million which generally increased by 9.4 percent in election years reflecting the opportunistic behavior of incumbent governments. Swing districts benefited more from the increase than non-swing districts, as the former received 4.3 percent more than the latter. Aligned districts in new democracy received, 2 percent more than non-aligned ones, while it was 4.3 percent more for swing districts in mature democracy. Therefore, the allocation formula is subject to political manipulations hence it is recommended that the unilateral appointment of the fund’s administrator by incumbent Presidents be reviewed in addition to creating autonomous public agencies to be responsible for the allocation formula and the fund administration independently.Item Effects of COVID-19 on Trade, Industrialisation and Globalisation in Africa.(Centre for Sustainable Development, University of Ibadan, Nigeria, 2021) Shinyekwa, I. M. B.; Kumeka, T.; Adedeji, A.; Adeniyi, O. A.This paper examined the potential effects of the global Corona Virus (COVID-19) pandemic on the paths of international trade, industrial development and economic globalization on the African continent. Deploying a purely descriptive analytical approach, a number of submissions are made. One, the pandemic significantly disrupted African trade -on both import and export sides - particularly owing to the closures of ports and other external trade infrastructure in China which is the largest trading partner for most African countries. Two, and somewhat related to the first point, the manufacturing sector that is meant to propel industrialization on the continent was also hard hit especially due to the huge shock to the supply chains of intermediate inputs. Third, since globalizations -on both the economic and cultural fronts- has led to greater interconnectedness, spillovers of the negative shock from China to other parts of the world including Africa is more palpable than otherwise. On the basis of the foregoing, some propositions on the key efforts that should be pursued and intensified are highlighted.Item Education and Inclusive Growth in West Africa(Emerald Publishing, 2021) Adeniyi, O. A.; Ajayi, P. I.; Adedeji, A."Abstract Purpose - Many West African countries face the challenge of growth inclusiveness. The region is also facing challenges of equipping its teeming population with high-quality skills despite many reforms and initiatives introduced in the past. This study, thus, identifies education as a crucial contributory factor to growth inclusiveness in the region. It, therefore, examined the role of education in growth inclusiveness in West Africa between 1990 and 2017. Design/methodology/approach - The study utilised different proxies to capture quantity and quality dimensions of education. The unit root and ARDL ""Bounds"" tests were employed at a preliminary stage. Based on the preliminary tests, the study explored autoregressive distributed lags modelling technique to capture the short-run and long-run dynamic effects. Findings - The empirical results reveal a positive impact of school enrolment measures in most of the countries in both short-run and long-run. Education quality measure exerts positive impact and significant in few countries under consideration. Practical implications - These countries should give adequate attention to quality when designing education policy to foster their inclusive growth. Originality/value - This study highlights the critical role of education in the inclusive growth pursuit. Education quantity is important to growth inclusiveness but the quality of education is more fundamental. The quality of education possessed determine to a large extent, what individual can contribute to the productive activities within the economy and accessibility to benefits from economic prosperity."Item Infrastructure-Structural Transformation Nexus in Africa: The Role of Financial Sector Development. Journal of African Development(Penn State University Press, 2021) Raifu, I. A.; Nnadozie, O. O.; Adeniyi, O. A.This study investigates the link between infrastructure and structural transformation in Africa as well as the mediating role of financial development on the nexus. We employ data from 24 African countries for the period 2003 to 2019 and adopt the system Generalized Method of Moments (sGMM) estimation technique. Our empirical results suggest that infrastructure and financial development foster structural transformation. However, our results show varying effects of ICT, electricity, and transport on sectoral value-added. Specifically, ICT infrastructure spurs the agricultural and manufacturing sectors value-added, electricity infrastructure aids all sectoral value-added, and transport infrastructure is important to the development of the manufacturing and services subsectors. Also, the agricultural and manufacturing sectors benefit more than the services sectors from financial-sector development. Overall, we find that infrastructure stimulates structural transformation. The net effect of the interaction of financial development and infrastructure on structural transformation appears to be zero, suggesting that financial development does not augment the nexus between infra- structure and structural transformation in Africa.Item Non-Linear Relation Between External Debt and Economic Growth in Nigeria: Does the Investment Channel Matter?(Faculty of Economics, University of Tehran., 2021) Adekunle, W.; Adeniyi, O. A.; Orekoya, S. O.Large external debt stock has been identified as one of the most important factors which have restricted the development of many poor countries. The consensus in the literature remains that external debt promotes growth to the extent that a country does not exceed its debt carrying capacity. Otherwise, additional debt accumulation would serve as a tax on future investment returns capable of creating disincentive to invest in the highly indebted countries. In the light of these arguments, this study investigates the possible role of domestic investment in the non-linear relation between external debt and economic growth in Nigeria over the period from 1981 to 2015. Based on the results of threshold regression analysis employed in this study, the overall findings showed that the impact of external debt on economic growth is sensitive to both measures of external debt used, and whether or not the role of domestic investment is accounted for. Specifically, this study confirmed the existence of the debt Laffer curve associated with the debt overhang theory arising from excessive external debt accumulation. Similarly, empirical support was obtained for the crowding-out effect of excessive external debt servicing. Also, accounting for the role of domestic investment in the non-linear relation between external debt and economic growth reduces the optimal debt carrying capacity of the country. It is therefore suggested that the Nigerian government internalizes a maximum ceiling of 6.81% as the share of external debt stock in gross national income (GNI) so as to enjoy the resulting growth benefits. External debt financing sources that are free of interest charge could also be explored so as to circumvent the burden imposed by excessive external debt servicing.