Estimating the modulating role of economic development on the effect of elections on government expenditure in Africa

Figures & data

Figure 1. Number of Elections by Countries.Source, Author’s construct, 2021

Figure 2. Government Expenditure in Pre-Election and Election Years.

Source, Author’s construct, 2021

Figure 3. The Distribution of Debt Servicing on Election by Country. Source: Authors’ construct, 2021

Figure 4. Government Expenditure and GDP Per Capita. Source: Authors’ construct, 2021

Table 1. Variable definition and expected signs

Variable	Definition	A priori sign
Government expenditure ($\mathrm{G}\mathrm{e}\mathrm{x}\mathrm{p}$)	Government expenditure is captured as recurrent and capital expenditure as a percentage of GDP	Dependent variable
Election ($\mathrm{E}\mathrm{l}\mathrm{e}\mathrm{c}$)	Election year/season is a dummy, with 1 indicating election year and 0 if non-election year.	Positive/Negative
GDP per capita ($\mathrm{G}\mathrm{d}\mathrm{p}\mathrm{c}\mathrm{a}\mathrm{p}$)	GDP per capita is the overall GDP of a country divided by the population in 2017 constant dollars	Positive
Inflation ($\mathrm{I}\mathrm{n}\mathrm{f}$)	Inflation rate is the consumer price index	Positive/ Negative
Unemployment ($\mathrm{U}\mathrm{n}\mathrm{e}\mathrm{m}\mathrm{p}$)	The unemployment rate is the proportion of unemployed as a percentage of the labour force	Positive
Governance System ($\mathrm{S}\mathrm{y}\mathrm{s}\mathrm{g}\mathrm{o}\mathrm{v}$)	System of governance is a dummy, with 1 indicating simple majority and 0 if a parliamentary system of governance	Positive/ Negative
Age Dependency Ratio ($\mathrm{A}\mathrm{D}\mathrm{R}$)	Dependency ratio is the proportion of people aged less than 16 and greater than 65 in the population	Positive
Election System ($\mathrm{E}\mathrm{l}\mathrm{s}\mathrm{y}\mathrm{s}$)	Electoral system is a dummy, with 1 indicating the presidential system of government and 0 if a parliamentary system of governance.	Positive/ Negative
Elec*Gdpcap	Interaction of election year and GDP per capita	Negative/Positive

Source: Author’s construct, 2021.

Table 2. Distribution of means of some selected variables across years of election

Variable	Obs.	Election	No election	Difference	Combined	t-statistics
Government Expenditure	1333	18.519(0.774)	15.758(0.229)	2.761(0.631)	16.178(0.228)	4.377***
Unemployment Rate	1333	8.294(0.486)	6.668(0.228)	1.626(0.544)	6.951(0.207)	2.987***
Age dependency Ratio	1333	89.136(0.811)	88.929(0.397)	0.207(0.934)	88.965(0.356)	0.222
GDP per capita	1333	6.424(0.078)	6.441(0.033)	0.016(0.085)	6.438(0.031)	0.182
Inflation rate	1333	65.214(0.087)	59.743(0.044)	5.471(0.103)	61.990(0.041)	7.234***

Robust standard errors in parentheses;

***p < 0.01, **p < 0.05, *p < 0.1

Table 3. Bivariate estimates of elections on government expenditure (Dependent variable: government expenditure)

	(1)	(2)	(3)	(4)	(5)	(6)	(7)
Variables	OLS	OLS	OLS	OLS	OLS	OLS	OLS
Election	0.028***
	(0.0081)
Unemployment		0.002***
		(0.0003)
Governance system			−0.173***
			(0.0102)
Age dependency				−0.001***
				(0.0002)
GDP per capita					0.013***
					(0.0024)
Electoral system						−0.044***
						(0.0052)
Inflation (CPI)							−0.016***
							(0.0052)
Constant	0.158***	0.146***	0.504***	0.240***	0.079***	0.236***	0.215***
	(0.0023)	(0.0032)	(0.0201)	(0.0168)	(0.0154)	(0.0094)	(0.0175)
Observations	1,169	1,169	1,169	1,169	1,169	1,169	1,169
R-squared	0.0162	0.0466	0.1190	0.0225	0.0331	0.0697	0.0157

Robust standard errors in parentheses;

*** p < 0.01, ** p < 0.05, * p < 0.1

Table 4. Effects of electoral on government expenditure (dependent variable: Government expenditure)

Log expenditure	(1)OLS	(2)Fixed effect 1	(3)Fixed effect 2	(4)GMM 1	(5)GMM 2
Election	0.1072**			0.0354***	0.1836**
	(0.0427)			(0.0087)	(0.0777)
Unemployment	0.0004*	0.0010***	0.0012***	0.0013***	0.0012***
	(0.0002)	(0.0001)	(0.0001)	(0.0003)	(0.0003)
Governance system	−0.1193***	−0.1087***	−0.1098***	−0.0544***	−0.0567***
	(0.0084)	(0.0069)	(0.0067)	(0.0131)	(0.0136)
Age dependency ratio	0.0001	−0.0001	−0.0003	0.0011***	0.0010***
	(0.0002)	(0.0002)	(0.0003)	(0.0001)	(0.0001)
GDP per capita	0.0105***	0.0081**	0.0104**	0.0274***	0.0292***
	(0.0027)	(0.0037)	(0.0046)	(0.0032)	(0.0037)
Election *GDP per capita	−0.0135**		−0.0123***		−0.0240*
	(0.0063)		(0.0021)		(0.0124)
Electoral system	−0.0229***	−0.0209***	−0.0130***	−0.0162***	−0.0163***
	(0.0038)	(0.0022)	(0.0029)	(0.0037)	(0.0038)
Inflation	−0.0081**	−0.0111**	−0.0198***	−0.0072**	−0.0071**
	(0.0041)	(0.0042)	(0.0029)	(0.0031)	(0.0031)
Expenditure (Lag)			0.0482**	0.1006***	0.1101***
			(0.0206)	(0.0285)	(0.0265)
Constant	0.3691***	0.3875***	0.3963***
	(0.0377)	(0.0523)	(0.0585)
Observations	1,333	1,333	1,333	1,169	1,169
R-squared	0.2108	0.2110	0.2834

Robust standard errors in parentheses;

*** p < 0.01, ** p < 0.05, * p < 0.1

Table

Variable	Obs.	Mean	Std. Dev.	Min	Max
Election year	1,169	0.152	0.359	0.000	1.000
Pre-election year	1,169	0.111	0.314	0.000	1.000
Government expenditure	1,169	16.178	7.808	2.0471	69.542
Unemployment rate	1,169	7.461	8.020	0.000	39.300
System of governance	1,169	1.975	0.155	1.000	2.000
Age dependency ratio	1,169	88.033	13.146	40.795	112.682
GDP per capita	1,169	6.464	1.108	4.612	10.058
Electoral system	1,169	1.677	0.467	1.000	2.000
Inflation rate	1,169	4.736	0.360	4.161	10.106

Source: Authors’ construct, 2021.

Table

	Government expenditure
Description of test	Chi2 value	z	Prob.
Arellano-Bond test for AR(1) in first differences		−3.72	0.000
Arellano-Bond test for AR(2) in first differences		−2.35	0.019
Sargan test of over-identification restrictions	524.04		0.172
Hansen test of over-identification restrictions	28.29		1.00
Difference-in-Hansen tests of exogeneity of instrument subsets: GMM instruments for levels
Hansen test excluding group	28.53		1.00
Difference (null H = exogenous)	−0.24		1.00
Hansen test excluding group	28.11		1.00
Difference (null H = exogenous)	0.18		0.981

Source: Authors’ construct, 2021.

Table

Angola Benin Botswana Burkina Faso Cameroon Cape Verde Central African Republic (CAR) Comoros Congo (Brazzaville) Democratic Republic of Congo Equatorial Guinea

Eritrea Ethiopia Gabon Gambia Ghana Guinea Guinea Bissau Ivory Coast Kenya Lesotho Liberia

Madagascar Malawi Mali Mauritius Mauritania Mozambique Namibia Niger Nigeria Rwanda Sao Tome and Principe

Senegal Seychelles Sierra Leone South Africa Sudan Tanzania Togo Uganda Zambia Zimbabwe

Source: Authors’ construct, 2021.