August 2016
Determinants of Commercial banks’ interest rate spreads in Botswana
The paper investigated the determinants of commercial banks’ interest rate spreads in Botswana using time series cross-sectional analysis for the period of 2004Q1 to 2014Q4. Factors empirically tested are bank-specific, industry-specific and macroeconomic data. Results indicate that bank intermediation, GDP, inflation and bank concentration are positively related to interest rate spread. The negative sign of the...
August 2016
Food Prices and Economic Well-Being in Sub-Saharan Africa
Over the years, Sub-Saharan Africa has been one of the regions worst hit with the deleterious effects of food insecurity owing to the soaring prices of food items. Therefore, this paper examines the effects of rising food prices on economic well-being in 31 Sub-Sahara African countries from 2001-2012 using panel regressions. Findings from the study reveal that both contemporaneous and the initially prevailing food...
August 2016
Do Economic Policy Decisions affect Stock Market Development in Ghana?
The Efficient Market Hypothesis proposes that macroeconomic policy actions do not influence stock market development but the Tobin’s q theory argues otherwise. This paper uses the autoregressive distributed lag (ARDL) technique to investigate the impact of macroeconomic policy on the development of the Ghana Stock Exchange for the period 1991-2011. The paper finds government revenue and exchange rate reduce stock...
August 2016
The Response of Banking Sector Development to Financial and Trade Openness in the Presence of Global Financial Crisis in Africa
Africa’s financial system is strongly bank-based and so this paper investigate whether economic growth, financial openness and trade openness contribute to the development of the banking sector in the presence and absence of global financial crisis. The results from PMG/ARDL suggest that banking sector develops independently of economic growth in lower-middle and high income countries while it develops as demand...
August 2016
TESTING THE VALIDITY OF WAGNER’S LAW IN THE NAMIBIAN CONTEXT: A TODA-YAMAMOTO (TY) GRANGER CAUSALITY APPROACH, 1991-2013
This paper examines the validity of Wagner’s (1883) hypothesis on the direction of causality between sectoral public expenditures and economic growth in Namibia for the period 1991-2013. It focuses on public expenditure on education, health and capital goods. Wagner law states that an increase in economic activity would lead to an increase in public expenditure while Keynesian law states that an increase in public...
August 2016
The Impact of Drought on Technical Efficiency of Smallholder Farmers in Hurungwe, Zimbabwe
Increasing drought frequencies due to climate change, pose a serious threat to rain-fed farmers in rural Africa where the policy thrust points to improving efficiency of these farmers. This article uses cross sectional data collected from 411 randomly selected farmers and applies the stochastic frontier method (SFM) to investigate the extent to which drought influences technical efficiency of smallholder farmers in...
