PUBLICATIONS

@workingpaper{Asongu2012bz,
title = {Globalization, (fighting) corruption and development: how are these phenomena linearly and nonlinearly related in wealth effects?},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/024},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/Globalisation-corruption-and-development-in-wealth-effects.pdf},
year = {2012},
date = {2012-02-01},
abstract = {Purpose – Is globalization instrumental in fighting corruption? Do wealth effects matter in
this fight? Are findings valid when linearity assumptions are dropped? This paper assesses the
Lalountas et al. (2011) hypotheses (conclusions) in the African context.
Design/methodology/approach – Though not in form, yet in substance the intuition and
motivation are compatible with those of Lalountas et al. (2011). Four hypotheses are tested
from different methodological and contextual standpoints. In the analysis, while the
economic and social dimensions of globalization are reflected in the HDI, the political
dimension is captured by good governance indicators. A TSLS-IV estimation technique is
applied where-in globalization instruments of trade and financial liberalization are
instrumented on human-development and government-quality to account for corruption
(corruption-control) effects. Thus the intuition is assessing how globalization is instrumental
in the fight against corruption through human development (economic and social dimensions)
and government quality (political dimension).
Findings – Hypothesis 1: Globalization is a powerful tool in fighting corruption (True).
Hypothesis 2: Globalization is an important tool in fighting corruption only in Middle and
High income countries (Partially True). Hypothesis 3: For Low income countries
globalization has no significant impact on corruption (True). Hypothesis 4: Hypotheses 1 and
2 are valid only under linearity (False).
Social Implications – In countries with high levels of per capita, emphasis is placed on the
political and social dimensions of globalization and as a result the effects of this phenomenon
on corruption-control are significant. Conversely, in nations with low levels of per capita
income, emphasis is given to the economic dimension of international integration and as a
result the effect of globalization on corruption is limited. As a policy implication, persistent
globalization as an effective means to reduce corruption in developing countries might lead to
inappropriate policies in low income countries.
Originality/value – This paper has tested the Lalountas et al. (2011) hypotheses in the
continent where concerns of globalization, human development and corruption are most acute.},
keywords = {Globalization; Corruption; Wealth effects; Africa},
pubstate = {published},
tppubtype = {workingpaper}
}

@workingpaper{Asongu2012b_26,
title = {On the effect of foreign aid on corruption},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/031},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/The-effect-of-foreign-aid-on-corruption.pdf},
year = {2012},
date = {2012-02-01},
abstract = {The Okada & Samreth(2012, EL) finding that aid deters corruption could have an
important influence on policy and academic debates. This paper partially negates their
criticism of the mainstream approach to the aid-development nexus. Using updated
data(1996-2010) from 52 African countries we provide robust evidence of a positive aidcorruption
nexus. Development assistance fuels(mitigates) corruption(the control of
corruption) in the African continent. As a policy implication, the Okada & Samreth(2012, EL)
finding for developing countries may not be relevant for Africa.},
keywords = {Foreign Aid; Political Economy; Development; Africa},
pubstate = {published},
tppubtype = {workingpaper}
}

@workingpaper{Asongu2012b_27,
title = {Real and Monetary Policy Convergence: EMU Crisis to the CFA Zone},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/033},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/Real-and-Monetary-Policy-Convergence.-EMU-Crisis-to-the-CFA-Zone.pdf},
year = {2012},
date = {2012-02-01},
abstract = {Purpose – A major lesson of the EMU crisis is that serious disequilibria result from regional
monetary arrangements not designed to be robust to a variety of shocks. The purpose of this
paper is to assess these disequilibria within the CEMAC, UEMOA and CFA zones.
Design/methodology/approach – In the assessments, monetary policy targets inflation and
financial dynamics of depth, efficiency, activity and size while real sector policy targets
economic performance in terms of GDP growth. We also provide the speed of convergence
and time required to achieve a 100% convergence.
Findings – But for financial intermediary size within the CFA zone, findings for the most part
support only unconditional convergence. There is no form of convergence within the CEMAC
zone.
Practical implications – The broad insignificance of conditional convergence results have
substantial policy implications. Monetary and real policies which are often homogenous for
member states are thwarted by heterogeneous structural and institutional characteristics
which give rise to different levels and patterns of financial intermediary development.
Therefore member states should work towards harmonizing cross-country differences in
structural and institutional characteristics that hamper the effectiveness of monetary policies.
Originality/value – The paper provides warning signs to the CFA zone in the heat of the
Euro zone crises.},
keywords = {CFA Zone; Currency Area; Convergence; Policy Coordination},
pubstate = {published},
tppubtype = {workingpaper}
}

@workingpaper{Asongu2012b_28,
title = {Reversed Economics and Inhumanity of Development Assistance in Africa},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/034},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/Reversed-economics-and-inhumanity-of-development-assistance-in-Africa.pdf},
year = {2012},
date = {2012-02-01},
abstract = {Purpose – The purpose of this paper is to assess the aid-development nexus in 52 African
countries using updated data (1996-2010) and a new indicator of human development(adjusted
for inequality).
Design/methodology/approach – The estimation technique used is a Two-Stage-Least Squares
Instrumental Variable approach. Instruments include: income-levels, legal-origins and religiousdominations.
The first-step consists of justifying the choice of the estimation technique with a
Hausman-test for endogeneity. In the second-step, we verify that the instrumental variables are
exogenous to the endogenous components of explaining variables(aid dynamic channels)
conditional on other covariates(control variables). In the third-step, the strength and validity of
the instruments are examined with the Cragg-Donald and Sargan overidentifying restrictions
tests respectively. Robustness checks are ensured by: (1) the use of alternative aid indicators; (2)
estimation under restricted and unrestricted hypotheses ; and (3) adoption of two interchangeable
sets of instruments.
Findings – The findings broadly indicate that development assistance is detrimental to GDP
growth, GDP per capita growth and inequality adjusted human development. Given concerns on
the achievement of the MDGs, the relevance of these results point to the deficiency of foreign
aid as a sustainable cure to poverty in Africa.
Social implications – It is a momentous epoque to solve the second tragedy of foreign aid; it is
high time economists and policy makers start rethinking the models and theories on which
foreign aid is based. In the meantime, it is up to people who care about the poor to hold aid
agencies accountable for piecemeal results.
Originality/value – These findings are based on data collected after pioneering works on the
aid-development nexus. Usage of the inequality adjusted human development index first
published in 2010, corrects past works of the bunch of criticisms inherent in the first index.},
keywords = {Foreign Aid; Political Economy; Development; Africa},
pubstate = {published},
tppubtype = {workingpaper}
}

@workingpaper{Asongu2012b_29,
title = {African Development: Beyond Income Convergence},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/002},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/African-Development.-Beyond-Income-Convergence.pdf},
year = {2012},
date = {2012-01-01},
abstract = {In examining some big questions on African development, we provide evidence that
dynamics of some development indicators could support both endogenous and neoclassical
growth theories in the convergence debate. This paper investigates convergence in real per
capita GDP and inequality adjusted human development in 38 African countries, disaggregated
into 10 homogenous panels based on regions (Sub-Saharan and North Africa), income-levels
(low, middle, lower-middle and upper-middle), legal-origins (English common-law and French
civil-law) and religious dominations (Christianity and Islam). The main finding is that the
income component of the human development index moves slower than others in the
convergence process and thus requires a more focused policy intervention. As a policy
implication, looking beyond income convergence can provide a concrete agenda for
development involving all aspects of economic, institutional and social life.},
keywords = {Human development; Growth; Convergence; Panel; Africa},
pubstate = {published},
tppubtype = {workingpaper}
}

@workingpaper{Asongu2012b_30,
title = {African Financial Development Dynamics: Big Time Convergence},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/003},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/African-financial-development-dynamics.-Big-time-convergence.pdf},
year = {2012},
date = {2012-01-01},
abstract = {Purpose - Assessment of African financial development dynamic convergences in money,
credit, efficiency and size.
Design/Methodology - The empirical evidence is premised on 11 homogenous panels based on
regions (Sub-Saharan and North Africa), income-levels (low, middle, lower-middle and uppermiddle),
legal-origins (English common-law and French civil-law) and religious dominations
(Christianity and Islam). We examine convergence in financial intermediary dynamics of depth,
efficiency, activity and size.
Findings - Findings suggest that countries with small-sized financial intermediary depth,
efficiency, activity and size are catching-up countries with large-sized financial intermediary
depth, efficiency, activity and size respectively. We also provide the speeds of convergence and
time necessary to achieve a full (100%) convergence.
Practical implications - The presence of strong links among African banking sectors may
present little opportunity for portfolio diversification. The convergence patterns show positive
steps towards regional integration. As a policy implication, African governments should not
relent in structural and institutional reforms.
Originality/value - It is the first critical assessment of convergence in financial intermediary
development dynamics in the African continent.},
keywords = {Convergence; Policy Coordination; Banking; Africa},
pubstate = {published},
tppubtype = {workingpaper}
}

@workingpaper{Asongu2012b_31,
title = {African Stock Market Performance Dynamics: A Multidimensional Convergence Assessment},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/004},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/Convergence-in-African-Stock-Market-Performance-Dynamics.pdf},
year = {2012},
date = {2012-01-01},
abstract = {This paper dissects with great acuteness, the issues of convergence in financial
performance dynamics in the African continent through the lenses of stock market capitalization,
value traded, turnover and number of listed companies. The empirical evidence is premised on
11 homogenous panels based on regions (sub-Saharan and North Africa), income-levels (Low,
Middle, Lower-middle and Upper-middle), legal-origins (English common-law and French civillaw)
and religious dominations (Christianity and Islam). Findings provide partial support for the
existence of absolute convergence in some dynamics. Only sub-Saharan Africa reveals
conditional convergence in relation to per capita number of listed companies. The speed of
convergence for the most part is between 12% and 28% per annum. As a policy implication,
countries should work towards adopting common institutional and structural characteristics that
favor stock market development.},
keywords = {Convergence; Stock markets; Panel; Africa},
pubstate = {published},
tppubtype = {workingpaper}
}

@workingpaper{Asongu2012b_32,
title = {Are Proposed African Monetary Unions Optimal Currency Areas? Real and Monetary Policy Convergence Analysis},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/005},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/Are-Proposed-African-Monetary-Unions-Optimal-Currency-Areas.-Real-and-Monetary-Policy-Convergence-Analysis.pdf},
year = {2012},
date = {2012-01-01},
abstract = {Purpose – A spectre is hunting embryonic African monetary zones: the EMU crisis. This
paper assesses real and monetary policy convergence within the proposed WAM and EAM
zones. The introduction of common currencies in West and East Africa is facing stiff
challenges in the timing of monetary convergence, the imperative of bankers to apply
common modeling and forecasting methods of monetary policy transmission, as well as the
requirements of common structural and institutional characteristics among candidate states.
Design/methodology/approach – In the analysis, monetary policy targets inflation and
financial dynamics of depth, efficiency, activity and size while real sector policy targets
economic performance in terms of GDP growth at macro and micro levels.
Findings – Findings suggest overwhelming lack of convergence: (1) initial conditions for
financial development are different across countries; (2) fundamental characteristics as
common monetary policy initiatives and IMF backed financial reform programs are
implemented differently across countries; (3) there is remarkable evidence of cross-country
variations in structural characteristics of macroeconomic performance; (4) institutional crosscountry
differences could also be responsible for the deficiency in convergence within the
potential monetary zones.
Practical implications – As a policy implication, heterogeneous structural and institutional
characteristics across countries are giving rise to different levels and patterns of financial
intermediary development. Thus member states should work towards harmonizing crosscountry
differences in structural and institutional characteristics that hamper the effectiveness
of convergence in monetary and real policies.
Originality/value – It is one of the few attempts to investigate the issue of convergence
within the proposed WAM and EAM unions.},
keywords = {Currency Area; Convergence; Policy Coordination; Africa},
pubstate = {published},
tppubtype = {workingpaper}
}

@workingpaper{Asongu2012b_33,
title = {Financial determinants of consumer price inflation. What do dynamics in money, credit, efficiency and size tell us?},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/019},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/Financial-determinants-of-consumer-price-inflation.pdf},
year = {2012},
date = {2012-01-01},
abstract = {Purpose – The purpose of this paper is to examine the effects of financial dynamic policy
options in money, credit, efficiency and size on consumer prices. Soaring food prices have
marked the geopolitical landscape of developing countries in the past few years.
Design/methodology/approach – The estimation approach used is a Two-Stage-Least Squares
Instrumental Variable technique. Instruments include: legal-origins; income-levels and religiousdominations.
The first-step consists of justifying the choice of the estimation approach with a
Hausman-test for endogeneity. In the second-step, we verify that the instrumental variables are
exogenous to the endogenous components of explaining variables(financial dynamic channels)
conditional on other covariates(control variables). In the third-step, the validity of the
instruments is examined with the Sargan overidentifying restrictions test. Robustness checks are
ensured by: (1) use of alternative indicators of each financial dynamic; (2) estimation with robust
Heteroscedasticity and Autocorrelation Consistent (HAC) standard errors; and (3) adoption of
two interchangeable sets of instruments.
Findings – Findings broadly reveal the following: (1) money(depth) and credit(activity) which
are in absolute measures have positive elasticities of inflation; while (2) financial efficiency and
size in relative measures have negative elasticities of inflation.
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 – As far as we have perused, 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.},
keywords = {Banks; Inflation; Development; Panel; Africa},
pubstate = {published},
tppubtype = {workingpaper}
}

@workingpaper{Asongu2012b_34,
title = {Politics and Consumer Prices in Africa},
author = {Simplice A Asongu},
editor = {African 2012 Governance and Development Institute WP/12/032},
url = {http://www.afridev.org/RePEc/agd/agd-wpaper/Politics-and-Consumer-Prices-in-Africa.pdf},
year = {2012},
date = {2012-01-01},
abstract = {The motivations of the Arab Spring that have marked the history of humanity over the
last few months have left political economists, researchers, governments and international
policymakers pondering over how the quality of political institutions affect consumer welfare
in terms of commodity prices. This paper investigates the effects of political establishments
on consumer prices in the African continent. Findings suggest that in comparison with
authoritarian regimes, democracies better provide for institutions that keep inflationary
pressures on commodity prices in check. As a policy implication, improving the quality of
democratic institutions will ameliorate consumer welfare through lower inflation rates. Such
government quality institutional determinants include, among others: voice and
accountability, rule of law, regulation quality, control of corruption and press freedom.},
keywords = {Consumer prices; Political institutions; Welfare; Africa},
pubstate = {published},
tppubtype = {workingpaper}
}