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Purpose – Education as a weapon in the fight against conflict and violence remains widely debated in policy and academic circles. Against the background of growing political instability in Africa and the central role of the knowledge economy in twenty-first century development, this paper provides three contributions to existing literature. The purpose of this paper is to assess how political stability/non-violence is linked to the incremental, synergy and lifelong learning effects of education. Design/methodology/approach – The authors define lifelong learning as the combined knowledge acquired during primary, secondary and tertiary education. Principal component analysis is used to reduce the dimensions of educational and political indicators. An endogeneity robust dynamic system Generalized Methods of Moments is used for the estimations. Findings – The authors establish three main findings. First, education is a useful weapon in the fight against political instability. Second, there is an incremental effect of education in the transition from secondary to tertiary schools. Third, lifelong learning also has positive and synergy effects. This means that the impact of lifelong learning is higher than the combined independent effects of various educational levels. The empirical evidence is based on 53 African countries for the period 1996-2010. Practical implications – A plethora of policy implications are discussed, inter alia: how the drive towards increasing the knowledge economy through lifelong learning can be an effective tool in the fight against violence and political insurgency in Africa. Originality/value – As the continent is nursing knowledge economy ambitions, the paper is original in investigating the determinants of political stability/non-violence from three dimensions of education attainment: the incremental, the lifelong learning and a synergy effect. [ABSTRACT FROM AUTHOR]

Purpose – This paper aims to assess how entrepreneurship affects knowledge economy (KE) in Africa. Design/methodology/approach – Entrepreneurship is measured by indicators of starting, doing and ending business. The four dimensions of the World Bank’s index of KE are used. Instrumental variable panel-fixed effects are applied on a sample of 53 African countries for the period of 1996-2010. Findings – The following are some of the findings. First, creating an enabling environment for starting business can substantially boost most dimensions of KE. Second, doing business through mechanisms of trade globalization has positive effects from sectors that are not information and communication technology (ICT) and high-tech oriented. Third, the time required to end business has negative effects on KE. Practical implications – The findings confirm the narrative that the technology in African countries at the moment may be more imitative and adaptive for reverse engineering in ICTs and high-tech products. Given the massive consumption of ICT and high-tech commodities in Africa, the continent has to start thinking of how to participate in the global value chain of producing what it consumes. Originality/value – This paper has a twofold motivation. First, given the ambitions of African countries of moving towards knowledge-based economies, the line of inquiry is timely. Second, investigating the nexus may have substantial poverty mitigation and sustainable development implications. These entail, inter alia, the development of technology with value-added services; enhancement of existing agricultural practices; promotion of conditions that are essential for competitiveness; and adjustment to globalization challenges. [ABSTRACT FROM AUTHOR]

Purpose – The purpose of this paper is to integrate two main strands of the aid-development nexus in assessing whether institutional thresholds matter in the effectiveness of foreign-aid on institutional development in 53 African countries over the period 1996-2010. Design/methodology/approach – The panel quantile regression technique enables us to investigate if the relationship between institutional dynamics and development assistance differs throughout the distributions of institutional dynamics. Eight government quality indicators are employed: rule of law, regulation quality, government effectiveness, corruption, voice and accountability, control of corruption, political stability and democracy. Findings – Three hypotheses are tested and the following findings are established: first, institutional benefits of foreign-aid are contingent on existing institutional levels in Africa; second, but for a thin exception (democracy), foreign-aid is more negatively correlated with countries of higher institutional quality than with those of lower quality; third, the institutional benefits of foreign-aid are not questionable until greater domestic institutional development has taken place. The reverse is true instead. government quality benefits of development assistance are questionable in African countries irrespective of prevailing institutional quality levels. Originality/value – This paper contributes to existing literature on the effectiveness of foreign-aid by focussing on the distribution of the dependent variables (institutional dynamics). It is likely that best and worst countries in terms of institutions respond differently to development assistance. [ABSTRACT FROM AUTHOR]

Purpose – The issue of which financial initial conditions are necessary to materialize the benefits of financial globalization remains open to debate in the literature. In this paper, the author tries to put some empirical structure on the concept of financial threshold conditions in order to give policymakers guidance on the Kose et al. and Henry hypothesis. Its object is to assess whether financial benefits of financial globalization are questionable until greater domestic financial development has taken place in African countries. The paper aims to discuss these issues. Design/methodology/approach – In framing the financial dimension in a more concrete and tractable manner, the author examines the concerns of how domestic financial initial dynamics of depth (economic and financial systems), efficiency (banking and financial systems), activity (banking and financial systems) and size, play out in the financial development benefits of financial globalization. The estimation approach consists of assessing the impact of financial globalization through out the conditional distributions of domestic financial development dynamics. Findings – The introduction of previously missing financial dimensions into the debate generates a number of important findings. Only financial initial (threshold) conditions of size are necessary to materialize the benefits of financial globalization. While financial depth only partially validates the hypothesis, dynamics of efficiency and activity (credit) do not confirm the hypothesis. Practical implications – Addressing the issue of surplus liquidity in African financial institutions could improve the benefits of financial size and potentially reverse the trends of financial efficiency and activity. Depending on the context of sampled countries, the appropriate role of policy has always been either to stem the tide of capital flows or encourage them. Policymakers who have been viewing their challenges exclusively from the latter perspective for benefits in growth (finance) might be getting the financial dynamics badly wrong. Originality/value – Blanket financial development policies may not reap the financial benefits of financial globalization until domestic financial dynamics of depth, efficiency, activity and size are critically considered. The introduction of the last three previously missing components in the literature sheds more light on the globalization-development nexus. [ABSTRACT FROM AUTHOR]

Purpose – The purpose of this paper is to examine the effects of policy options in financial dynamics (of money, credit, efficiency and size) on consumer prices. Soaring food prices have marked the geopolitical landscape of African countries in the past decade. Design/methodology/approach – The sample is limited to a panel of African countries for which inflation is non-stationary. VAR models from both error correction and Granger causality perspectives are applied. Analyses of dynamic shocks and responses are also covered and six batteries of robustness checks are applied, to ensure consistency in the results. Findings – First, it is found that there are significant long-run equilibriums between inflation and each financial dynamic. Second, when there is a disequilibrium, while only financial depth and financial size could be significantly used to exert deflationary pressures, inflation is significant in adjusting all financial dynamics. In other words, financial depth and financial size are more significant instruments in fighting inflation than financial efficiency and activity. Third, the financial intermediary dynamic of size appears to be more instrumental in exerting a deflationary tendency than financial intermediary depth. Fourth, the deflationary tendency from money supply is double that based on liquid liabilities. Practical implications – Monetary policy aimed at fighting inflation only based on bank deposits may not be very effective until other informal and semi-formal financial sectors are taken into account. It could be inferred that, tight monetary policy targeting the ability of banks to grant credit (in relation to central bank credits) is more effective in tackling consumer price inflation than that, targeting the ability of banks to receive deposits. In the same vein, adjusting the lending rate could be more effective than adjusting the deposit rate. The insignificance of financial allocation efficiency and financial activity as policy tools in the battle against inflation could be explained by the (well documented) surplus liquidity issues experienced by the African banking sector. Social implications – This paper helps in providing monetary policy options in the fight against soaring consumer prices. By keeping inflationary pressures on food prices in check, sustained campaigns involving strikes, demonstrations, marches, rallies and political crises that seriously disrupt economic performance could be mitigated. Originality/value – To the best of the author's knowlege, there is yet no study that assesses monetary policy options that could be relevant in addressing the dramatic surge in the price of consumer commodities. [ABSTRACT FROM AUTHOR]