Slow growth and slow convergence in sub-Saharan Africa

Abstract

We expand on the sub-Saharan Africa (SSA)–Rest of World (ROW) growth difference literature and find a robust and consistently negative coefficient of an SSA dummy variable over the period 1965 to 2000. Most importantly, we find that SSA countries converge more slowly, if at all, than ROW countries.

Keywords:

• SSA
• augmented Solow growth model
• growth
• convergence

JEL Classification:

• O40
• O55

Notes

¹ In this study, sub-Saharan Africa (SSA) refers to African countries entirely or largely in the tropical zone. Rand zone countries are excluded from ‘SSA’ as used here.

² Our use of initial values of explanatory variables avoids simultaneity bias.

³ In Equation 3(3), ln y_it = (1 – e^-λt)ln y_i* + e^-λt ln y_i.; ln y_it is halfway between its initial and steady-state values when e^-λt = ½. The half-life of distance to steady state is then ln(½)/λ or 0.69/λ.