Browsing by Author "Amoateng, K.A."
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Item The distributional effects of fiscal and monetary policies in Africa(Journal of Social and Economic Development, 2022) Kunawotor, M.E.; Bokpin, G.A.; Asuming, P.O.; Amoateng, K.A.Income inequality has been persistent and indeed high in Africa over decades. Accordingly, a lot of empirical drivers have been identified to address it, albeit to a large extent of fiscal and monetary policies in Africa. This paper provides empirical evidence on the distributional effects of both fiscal and monetary policies in Africa over the period 1990– 2017. We employ a two-step dynamic system, GMM, a simultaneous quantile regression, and also use variants of fscal and monetary indicators, including fscal redistribution. Our results show that fscal redistribution has been quite effective in Africa, as refected in the role played by income taxes and transfers in reducing Gini coefficients, albeit to a relatively little extent. In particular, we find that direct tax is progressive and a potent tool in redistributing income in favour of the have-nots. Indirect tax, unsurprisingly, is regressive and income unequalizing. Similarly, we find property taxes to have income-unequalizing effects in Africa. The results of the expenditure indicators reveal that government spending on basic and primary education narrows net income inequality, while government spending on secondary and tertiary education rather widens net income inequality. Lastly, we find that contractionary monetary policy has unintended distributional effects in Africa. We suggest that governments should broaden the tax net, increase the share of direct tax, and property tax and spend more on basic education to improve income distribution in AfricaItem The Impacts of Extreme Weather Events on Inflation and the Implications for Monetary Policy in Africa(Progress in Development Studies, 2022) Kunawotor, M.E.; Bokpin, G.A.; Asuming, P.O.; Amoateng, K.A.Economic debates around mitigating climate change and weather-related events have long centred on fiscal policy tools than those of monetary policy. However, recent discussions point out that monetary policy formulation could also be affected and hence the need to deploy monetary policy tools as well. Our article seeks to investigate the impacts of climate change, particularly extreme weather events, on headline inflation and food price inflation and their apparent implications for monetary policy in Africa over the period 1990–2017. Using a two-step dynamic system With a generalized method of Moments estimation strategy with robust standard errors, we find that weather-related events may need to be large and consequential to cause a significant price hike in Africa. We also find the incidence of droughts and floods to have a bearing on food price inflation. Furthermore, our empirical evidence using mediation analysis reveals agricultural production to be the critical mechanism whereby extreme weather events affect headline inflation. As central banks are charged with the mandate of ensuring a stable monetary environment, We suggest thatmonetary policy authorities consider the short- and long-term impacts of supply shocks caused by extreme weather events on general price levels in their policy formulation.Item The Implications Of Climate Change And Extreme Weather Events For Fiscal Balance And Fiscal Policy In Africa(Journal of Social and Economic Development, 2022) Kunawotor, M.E.; Bokpin, G.A.; Asuming, P.O.; Amoateng, K.A.African countries quite often experience weather-related events as a result of climate variability. In this study, we investigate the effects of climate change and the incidence of extreme weather events on fscal balance and the broad implications for fscal policy formulation in Africa. We employ the system GMM, fixed-efects and random-efects estimation strategies over the period 1990–2017. We find that increases in temperature change anomaly which implies a warmer climate in a meteorological year worsens fscal balance in Africa. Our fndings also reveal that weather-related events may have a signifcant impact on fscal balance, if the damage caused is large and consequential. Furthermore, African countries with relatively strong institutions and adaptive capacities tend to modulate the impact of temperature change anomaly and extreme weather events on fscal balance. We forecast that the frequent incidence of climatic disruptions and extreme weather events which are considered as external shocks may toughen the fscal consolidation eforts and debt sustainability measures of some African governments.