Department of Economics

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Author: search.filters.author.Sunge Regret

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    Growth Effects of Foreign Direct Investments in Zimbabwe: Do Sources Matter?
    (Great Zimbabwe University, 2021) Chinyanganya Kudakwashe. L; Sunge Regret
    The study investigated foreign direct investment (FDI) growth effects in Zimbabwe using data spanning 1990-2019. FDI-led growth theories often view FDI as an enabler of economic growth. However, the extent may depend upon the source of FDI. Nonetheless, existing studies on Zimbabwe base their conclusions on aggregate FDI. Accordingly, we provide fresh evidence by disaggregating FDI inflows by sources. This is logical given the reality that FDI from different sources is heterogeneous. We used the Autoregressive-Distributed-Lag (ARDL) technique to estimate a time series model derived from neoclassical and endogenous growth models. Results indicated that FDI has a significantly positive growth effect. More importantly, we document that FDI sources do matter greatly. Specifically, FDI flows from Africa and Asia were found to have positive and significant growth effects. However, FDI from Europe and the United States has negative and insignificant impacts. We proffer two recommendations. Zimbabwe should attract more FDI from economies/regions in the vicinity of its level of development. Accordingly, Zimbabwe should rationally embrace the recently launched AfCFTA. It is vital to strike a balance between market deepening and promoting domestic production. Also, while most FDI from Asia is from is China, we urge Zimbabwe to provide a conducive environment to investors from the rest of Asia. This can be achieved through signing bilateral FDI agreements with Asian countries.
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    CO2 emissions and economic growth: Assessing the heterogeneous effects across climate regimes in Africa
    (Elsevier, 2022) Espoir Delphin Kamanda; Mudiangombe Benjamin Mudiangombe; Bannor Frank; Sunge Regret; Tshitaka Jean-Luc Mubenga
    Climate change has occasioned several Earth long-term events, including extreme temperatures. In recent years, Africa was reported as part of the world's regions that experienced extreme temperatures above pre-industrial levels. Despite lower contribution to Green House Gas (GHG) emissions and global warming, Africa remains among the world regions that suffer the most from climate change. However, the impact of climatic factors of temperature and emissions on economic production in Africa has not been broadly investigated, specifically among climate regimes. In this study, we attempt for the first time to understand the heterogeneous impacts of emissions and temperature on income in Africa using panel and time-series techniques on datasets spanning the years 1995-2016. At the global level in Africa, our empirical results reveal that a 1% increase in average temperature reduces income by 1.08%, whereas a 1% rise in CO2 emissions spurs income by 0.23%. The emissions effect result implies that environmental policies specifically designed to reduce CO2 emissions in Africa as a whole may significantly impact production in the long run. Also, the result suggests that a shift from optimal temperature levels to extreme patterns deter economic growth. Despite these revelations, our extended analysis based on climate regimes indicates heterogeneous effects across countries. Considering the Paris agreement on climate, this study suggests that policymakers should emphasize country-specific policies than global climatic policies for sustained CO2 emissions reduction in Africa.
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    Agricultural trade liberalization, regional trade agreements and agricultural technical efficiency in Africa
    (Sage, 2020) Sunge Regret; Ngepah Nicholas
    Despite increased agricultural trade liberalization, high productive inefficiency in agriculture has kept Africa as a net importer of agriculture products. Empirical studies have focused on the trade liberalization–productivity growth nexus and overlooked the efficiency linkage. Also the role of regional trade agreements (RTAs) and institutions in reducing inefficiency in agriculture have been sidelined. We use a stochastic frontier approach and single-stage maximum likelihood estimation of a true fixed-effects panel data model for our analysis. Using maize and rice data, we provide evidence that through technology transfer, agricultural trade statistically improves technical efficiency. Moreover, results suggest that RTAs provide favorable technical efficiency effects, which varies across products and membership. Furthermore, we document that while regulatory quality reduces technical inefficiency, control of corruption increases it. Our findings call for increased role of RTAs in promoting agricultural trade liberalization. This should be complemented by further strengthening of institutions involved in the agriculture value chain.