Home

>

Construction, institutions and economic growth in sub-Saharan Africa

The construction sector in developing countries has propelled economic growth in the most recent period, yet analysis of growth performance has failed to take this into account. This article is a comparative analysis of the relationship between the construction sector and aggregate output for a panel of sub-Saharan African (SSA) countries using a panel generalized methods of moments (GMM). After accounting for the effects of institutional set up, cross sectional heterogeneity and non-linearity, our results revealed that the construction sector affects growth positively and most importantly, developing the right institutions could further enhance this impact. The intrinsically non-linear relationship between construction and output growth is very mute in our sample, suggesting that, SSA countries have not yet reached the stage of development where construction growth becomes trivial. We further show that East Africa experienced a robust impact of construction on economic growth compared to West and Southern Africa.

Working paper 622
1 July 2016
SHARE THIS Policy Brief / Working Paper PUBLICATION:

Related South Africa’s Cities and Growth Spatial Challenges and Policy Interventions Content

Request for Proposals: The role of cities as drivers of growth and employment
Background Urbanization in South Africa is expected to reach 80% by...
Call for Work
South Africa’s future will be decided in our cities
Discussion Document 14 South Africa’s cities face multiple, overlap...
Dieter von Fintel, Justin Visagie, Ivan Turok, Takwanisa Machemedze, Claus Rabe, Sebastian Galiani, Edward Glaeser
Discussion Document
Monitoring South Africa’s metropolitan economies: A survey of the data landscape
Discussion Document 13 Disparities in data across different metropo...
Dieter von Fintel
Discussion Document
Cities, productivity and Jobs in SA: Problems and potential
Discussion Document 12 Cities contribute to national prosperity bec...
Ivan Turok, Justin Visagie
Discussion Document
Place-based economic policies: international lessons for South Africa
Discussion Document 11 Place-based policies are designed to support...
Harris Selod, Claus Rabe
Discussion Document
What luminosity data can and cannot reveal about South Africa’s urban economies
Discussion Document 10 As novel types of data are becoming availabl...
Takwanisa Machemedze
Discussion Document
Crime: A policy-oriented survey
Discussion Document 9 South Africa has a reputation for having high...
Sebastian Galiani
Discussion Document
Virtual CDE Workshop on SA Cities and Growth
Urban economics has provided powerful insights into how the charact...
Workshop

Search Resources

Ground Floor Brookside Building
11 Imam Haron Road
Claremont, 7700
Cape Town

PostNet Suite # 109
Private Bag X1005
Claremont 7735
Cape Town

Get Social