Economic Growth in Africa

"Africa is the world's poorest continent. It has had an uncertain transition from colonialism, with the Cold War and increases in corruption being major contributing factors to its poor economic situation. While rapid growth in China and India, has lifted millions beyond subsistence living, Africa has stagnated, even going backwards in terms of foreign trade, investment, and per capita income. This poverty has widespread effects, including low life expectancy, violence, and instability.

The central challenge facing African economies is to reduce poverty through higher levels of economic growth. Long term, broad-based economic growth is essential for Africa to increase incomes and reach its potential to become a significant trade and investment partner in the world economy.

Sub-Saharan Africa experienced strong economic growth rates in the latter half of the 1990s and in the past five years, reflecting the implementation of better economic policies and structural reforms. Sub-Saharan African countries therefore face major challenges, to raise growth and reduce poverty, and to integrate themselves into the world economy. Economic growth rates are still not high enough to make a real dent in the pervasive poverty and enable these countries to catch up with other developing nations. What is needed is a sustained and substantial increase in real per capita GDP growth rates in these countries, coupled with significant improvements in social conditions...

In this paper we will try to explain economic growth in Africa by using the Solow model of growth."


Wherein I actually used what I learned in Econometrics. The dataset used (adapted from David Weil) is also available.