Journal of Economics Theory

Year: 2009
Volume: 3
Issue: 3
Page No. 41 - 52

Export Performance in Sub-Saharan Africa: An Explanation

Authors : M. Adetunji Babatunde

Abstract: This study attempts to explain export performance in SSA using a panel of 20 countries, over the period 1980-2005. Most of the studies that explain export performance in SSA assume that exports are determined by supply-side variables and ignore the demand-side determinants of exports in SSA. This gap in the literature seems to have arisen because the typical developing country is assumed to be small and to face an infinitely elastic demand for its exports, so that changes in foreign demand can influence exports only through changes in world prices. In addition, studies that have ignored the role of other factors such as natural barriers, infrastructural availability and market access in explaining SSA export performance. Ignoring such factors could yield inconclusive results. To our knowledge, no study has focus exclusively on SSA and address the issue by utilizing a system of equations from the demand and supply-side of exports. Evidence reveals that the exports of SSA have performed poorly because the demand for Sub Saharan African exports has low elasticity in relation to changes in world income and in most cases are uncompetitive in world market. In addition, declining infrastructure investment seems to have generated substantial transaction costs and have important roles to play in determining the magnitude and direction of export trade of SSA countries.

How to cite this article:

M. Adetunji Babatunde , 2009. Export Performance in Sub-Saharan Africa: An Explanation. Journal of Economics Theory, 3: 41-52.

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