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Institutional quality, openness, and investment in Africa
South African Journal of Economic and Management Sciences | Vol 6, No 2 | a3318 |
DOI: https://doi.org/10.4102/sajems.v6i2.3318
| © 2019 Tonia Kandiero, Satish Wadhawan
| This work is licensed under CC Attribution 4.0
Submitted: 31 July 2019 | Published: 30 June 2003
Submitted: 31 July 2019 | Published: 30 June 2003
About the author(s)
Tonia Kandiero, Department of Economics, University of Pretoria, South AfricaSatish Wadhawan, Department of Economics, Howard University, South Africa
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This study supports the conventional wisdom that openness to trade is good for investment and economic growth. Whether this conclusion leaves space for institutional quality as a complimentary policy to determine the success of trade liberalization in Africa is the objective of this paper. The theoretical model and empirical analysis show how the behavior of government bureaucrats can be used to explain the impact on investment of the interaction between increased openness to trade and the quality of institutions. Empirical work is conducted using panel data observed over three periods: 1985-1990, 1990-1995, and 1995-2000.
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