Assessing marketing and aid strategies to stimulate economic growth in sub-Saharan Africa
type: CreativeWork
description: Stimulating economic development and growth has been difficult in Sub-Saharan Africa (SSA). In this three-essay dissertation, I examine and assess two strategies—market-based risk management through hedging, and growth through aid—that could potentially facilitate growth in SSA. Since many SSA countries derive a considerable portion of their total export revenues and foreign exchange from the exports to highly volatile commodity markets, risk management strategies are viewed as viable methods to reduce the negative effects of risk on development and growth (Razzaque, Osafo-Kwaako and Grynberg, 2007). Here I investigate the usefulness of futures markets for hedging price, production and hence, revenue risk in the cocoa market, a commodity particularly important to SSA countries such as Ghana, La Cote d’Ivoire (CIV), Nigeria, Togo, Uganda, and Cameroon. An ability to hedge commodity-market volatility reduces terms-of-trade risk, leading to a more effective allocation of resources (Ramey and Ramey, 1995). The effectiveness of aid in stimulating growth is controversial (Bruckner, 2011; Naito, 2010; Leeson, 2008; Collier, 2007 and Easterly, 2006). Highly diverse economic situations, economic programs, and political instability make it difficult to identify when aid will have a positive effect on growth. I examine factors that stimulate economic growth in SSA using recent data, while addressing endogeneity problems that typically plague the aid-growth relationship. In particular, I focus on the relationship between political stability, foreign aid and growth because although political stability is a pertinent factor affecting growth in SSA, the empirical literature has largely ignored its influence until very recently. The existing literature concludes that good macroeconomic policy is the crucial factor in determining efficacy of aid in stimulating growth, basing this conclusion on Burnside and Dollar’s (2000) finding of a significant aid-policy effect. Similar to Islam …
abstract: Stimulating economic development and growth has been difficult in Sub-Saharan Africa (SSA). In this three-essay dissertation, I examine and assess two strategies—market-based risk management through hedging, and growth through aid—that could potentially facilitate growth in SSA. Since many SSA countries derive a considerable portion of their total export revenues and foreign exchange from the exports to highly volatile commodity markets, risk management strategies are viewed as viable methods to reduce the negative effects of risk on development and growth (Razzaque, Osafo-Kwaako and Grynberg, 2007). Here I investigate the usefulness of futures markets for hedging price, production and hence, revenue risk in the cocoa market, a commodity particularly important to SSA countries such as Ghana, La Cote d’Ivoire (CIV), Nigeria, Togo, Uganda, and Cameroon. An ability to hedge commodity-market volatility reduces terms-of-trade risk, leading to a more effective allocation of resources (Ramey and Ramey, 1995). The effectiveness of aid in stimulating growth is controversial (Bruckner, 2011; Naito, 2010; Leeson, 2008; Collier, 2007 and Easterly, 2006). Highly diverse economic situations, economic programs, and political instability make it difficult to identify when aid will have a positive effect on growth. I examine factors that stimulate economic growth in SSA using recent data, while addressing endogeneity problems that typically plague the aid-growth relationship. In particular, I focus on the relationship between political stability, foreign aid and growth because although political stability is a pertinent factor affecting growth in SSA, the empirical literature has largely ignored its influence until very recently. The existing literature concludes that good macroeconomic policy is the crucial factor in determining efficacy of aid in stimulating growth, basing this conclusion on Burnside and Dollar’s (2000) finding of a significant aid-policy effect. Similar to Islam …
author: Armah, Stephen
language: en
keywords: Aid, growth, hedging, market efficiency
date published: 2013-02-03T19:16:51Z
date modified: 2026-07-22T22:25:31Z
provider: University of Illinois - Urbana-Champaign
publisher: Networked Digital Library of Theses and Dissertations
type: WebPage
source organization: University of Illinois at Urbana-Champaign

PropertyValue
property ID: Handle
value: http://hdl.handle.net/2142/42136