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Democracy and Intra-Africa Trade
Whelsy Boungou1, Francis Osei-Tutu2, Amara Zongo3
1Paris School of Business, France, 59 Rue Nationale, 75013 Paris, France.
Comparative Economic Studies
|January 23, 2023
Summary
Democracy boosts intra-Africa trade, especially in manufacturing. Reversals to autocracy harm trade flows, highlighting democracy
Area of Science:
- Economics
- Political Science
- International Trade
Background:
- Intra-Africa trade remains low despite policy efforts.
- Understanding factors influencing regional trade is crucial for economic development.
Purpose of the Study:
- To investigate the impact of democracy on intra-Africa trade of goods.
- To determine if democratic development can accelerate regional trade.
Main Methods:
- Utilized the gravity model of trade.
- Analyzed bilateral trade data for 48 Sub-Saharan African countries.
- Data covers the period from 2000 to 2018.
Main Results:
- Democracy positively influences intra-Africa goods trade.
- The effect of democracy is stronger in the manufacturing sector.
- Transitions to autocracy negatively impact trade flows.
Conclusions:
- Democratic development is a significant driver for increasing intra-Africa trade.
- Promoting democracy can be a strategy to enhance regional economic integration.
- Policy interventions should consider the link between governance and trade performance.
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