Services trade and infrastructure development: Evidence from African countries

Figures & data

Table 1. Correlation analysis

		1	2	3	4	5	6	7	8	9	10	11
1	lntelcom.
2	lnt&t.	0.11
3	lnport	0.47	−0.16
4	lnsto	0.21	0.31	0.11
5	lngdp	0.49	0.22	0.28	0.43
6	lnfd	0.51	0.50	0.48	0.56	0.48
7	lngfcf	0.21	0.04	−0.27	0.34	0.33	0.20
8	lnextdebt	−0.18	−0.11	0.10	−0.21	−0.28	−0.32	−0.25
9	lnpopdens	0.03	0.09	0.10	0.13	−0.25	0.04	−0.11	0.01
10	lnurb	0.30	−0.29	0.06	0.36	−0.26	−0.27	−0.22	0.43	−0.05
11	lnexcrt	−0.40	0.15	−0.31	−0.08	−0.41	−0.25	−0.15	0.02	0.05	0.37
12	lnser	0.40	0.28	0.45	0.62	0.43	0.48	0.03	−0.14	0.40	−0.29	−0.30

Source: Author’s computation

Table 2. Variables descriptive analysis, sources, and definition

Variables	Definition	Sources	Mean	Std. dev.	Min.	Max.
lntelcom	Telecommunications infrastructure (measured as fixed telephone subscriptions (per 100 people)	WDI	0.10	0.69	1.13	2.26
lnt&t	Trade/transport-related infrastructure (measured as the quality of trade and transport-related infrastructure) which is based on the logistics performance assessment by the WDI	WDI	0.82	0.29	0.23	2.12
lnport	Ports infrastructure (measured as the quality of port infrastructure) which is based on the logistics performance assessment by the WEF	WEF	1.15	0.40	0.31	2.03
lnsto	Services trade openness is constructed based on the GATS definition of services and Squalli and Wilson’s (2011) approach	Author’s construct	4.40	2.44	0.85	10.72
lnrgdppc	GDP per capita in real term (at 2010 constant US$)	WDI	6.89	0.89	5.36	9.22
lnfd	Financial development (measured by domestic credit to the private sector as % of GDP)	WDI	4.00	0.29	4.06	5.26
lngfcf	Gross fixed capital formation (measured as % of GDP)	WDI	3.09	0.51	1.11	4.39
lnextdebt	External debt stocks (% of GNI)		3.73	0.81	0.93	7.23
lnpopdens	Population density (measured as people per sq. km)	WDI	3.75	1.09	1.08	6.44
lnurb	Urbanization (measured by population in the largest cities as % of the total population)	WDI	3.51	0.45	1.43	4.49
lnexcrt	Exchange rate (measured as the official rate per US$)	WDI	4.51	2.50	0.35	11.02
lnser	Services sector (measured by the services value addition to GDP)	WDI	3.20	0.28	1.65	4.42

Source: Author’s computation

Note: WDI = World Development Indicators, WEF = World Economic Forum

Table 3. System GMM estimate of the services trade effect on infrastructure development

Variables	(1)Telecommunications infrastructure	(2)Trade/transport-related infrastructure	(3)Port infrastructure
Constant	2.338	−5.065***	12.45*
	(1.476)	(0.821)	(6.523)
L.Infrast.	0.449***	0.754***	0.872***
	(0.151)	(0.107)	(0.0939)
lnSTO	0.0205***	0.00516**	0.00210**
	(0.00724)	(0.00245)	(0.00103)
lnRGDP	0.747*	0.0163**	0.0477*
	(0.398)	(0.00767)	(0.0268)
lnFD	0.106*	0.0892*	0.0416*
	(0.0525)	(0.0479)	(0.0228)
lnGFCF	0.121	0.134*	−0.128***
	(0.124)	(0.0711)	(0.0437)
lnEXTDEBT	0.000604*	0.0770***	0.192**
	(0.000349)	(0.0244)	(0.0939)
lnPOPDENS	0.0403	0.0281**	0.0313*
	(0.0314)	(0.0141)	(0.0169)
lnURB	0.0596**	−0.00758*	0.000970
	(0.0290)	(0.00399)	(0.000612)
lnEXCRT	−0.385***	0.0166	−0.926*
	(0.143)	(0.0885)	(0.560)
lnSER	0.550**	0.688***	0.0304*
	(0.279)	(0.203)	(0.0172)
Sargan_test	(0.309)	(0.366)	(0.111)
Hansen_test	(0.094)	(0.568)	(0.324)
AR(2)	(0.592)	(0.459)	(0.164)
Observations	527	662	604
No. of code	38	38	38
Instruments	35	30	33
Year effect	Included	Included	Included

Source: Author’s computation

Note: The statistical significance of the estimates at < 1%, < 5%, and < 10% are denoted by ***, **, and * respectively. Values in parentheses are standard errors, except for the Hansen, Sargan, and AR(2) tests which are probability values.

Table

Algeria	Madagascar
Angola	Mali
Benin	Mozambique
Burkina Faso	Mauritania
Burundi	Malawi
The central African Republic	Niger
Cote d’Ivoire	Nigeria
Cameroon	Rwanda
Congo, Dem. Rep	Sudan
Congo, Rep.	Senegal
Egypt, Arab Rep.	Sierra Leone
Gabon	Chad
Ghana	Togo
Guinea	Tunisia
The Gambia	Tanzania
Guinea-Bissau	Uganda
Kenya	South Africa
Liberia	Zambia
Morocco	Zimbabwe

Squalli, J., & Wilson, K. (2011). A new measure of trade openness. The World Economy, 34(10), 1745–1770. https://doi.org/10.1111/j.1467-9701.2011.01404.x

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