Urbanization and Economic Growth: Panel Data Evidence from Africa

Applied Economics Letters, 2015

Heterogeneous panel causality tests are employed to consider the relationship between urbanization change and economic growth. Urbanization causes economic growth in high income countries, but non-causality could not be rejected for both middle-income and Latin American countries. A bi-directional, equilibrium relationship is observed for low-income, predominately African countries where economic growth has a positive, causal effect on urbanization, but where urbanization has a negative, causal effect on economic growth. Hence, urbanization and economic growth either co-evolve in low income/African and high income countries, or else the two processes are decoupled for middle income and Latin American countries.

Advances in Electronic Government, Digital Divide, and Regional Development, 2018

Over the past 50 years, the world has witnessed a very rapid urban growth, and projections have shown that by the year 2050, two-thirds of the world population will be living in urban centers, with Africa's urban population projected to reach 67% from its current 40%. Nigeria, being the most populous country in Africa, is projected to have an urban population of 67%. Several challenges go with urbanization. This chapter examined the effectiveness of Nigeria's budgetary expenditure in managing Nigeria's urbanization threats. The chapter found that Nigeria's urbanization management strategy is more system maintenance based than system development. Therefore, despite the huge government expenditure incurred over the years, Nigeria's urban challenges are still alarming. Accordingly, the chapter concludes by recommending that Nigeria plan its urban expenditure to ensure sustainability.

MATTHEW, Uduak Patrick, 2025

The study examines the effects of population, urbanization and economic growth in Nigeria using secondary data source from the publication of central bank of Nigeria statistical bulletin from 1986 to 2023. The main objective od the study was to ascertain the effect of population growth on economic growth in Nigeria and to ascertain the effect of urbanization on economic growth in Nigeria. Moreover, to achieve the stated objectives, the autoregressive distributive lag model employed to examine the effects of the independent variables on the dependent variable. Finding shows that population growth has a negative effect on economic growth in Nigeria while urbanization in Nigeria has been found to have a positive relationship with economic growth. The study therefore recommend that government should prioritize educational programs and vocational training to equip the growing population with skills necessary for the job market, thereby reducing unemployment rates and enhancing productivity. Also, to maximize the benefits of urbanization, effective urban planning must be prioritized. This includes creating policies that manage urban sprawl, ensuring access to basic services, and promoting sustainable living conditions in cities.

The variables are in natural logarithmic forms. The IPS test statistic has a N (0, 1) distribution under the null of non-stationarity. Large negative values indicate stationarity .

IOSR Journal of Humanities and Social Science, 2023

Cities are the driving force for socioeconomic growth and development. Over 75 percent of the global GDP are generated in cities and urban centers. The future of economic growth in Africa lies within the confines of emerging cities, and the role of cities in ecoinomic growth cannot be overemphasized. Future development strategies for new cities must focus on the well-being of its people. Studies have shown that Sub-Sahara Africa is not expected to be urban in the next 25 years. As of 2021, 58 percent of Africa's population lived in rural areas, and Africa is the least urbanized places on earth. In this article, we identified the need for Africa countries to be more urbanised as a necessary condition for economic growth and development. We made comparisons with other developed and developing countries of the world, and the relationship between city development and economic growth. We conclude that that future development strategies for new cities must be people-centered, and integrated with public institutions and infrastructural processes to raise incomes, reduce inequality and improve well-being.

Journal of Asian and African Studies, 2019

The study analyses the dynamic effect of rural-urban relationship, economic growth and urban agglomeration in sub-Saharan Africa with a view of testing the validity of the Williamson-Kuznets hypothesis. The study utilized panel data analysis with pooled ordinary least squares with secondary annual time series data ranging from 1970 to 2017 and sourced from the World Bank database. The study equally employed both homogeneous and heterogeneous panel unit root tests to verify the stationarity of the panel data variables before estimating the model. However, the estimation result revealed that both rural and urban population growth has a negative impact as well as a statistically significant result on urban agglomeration in sub-Saharan Africa. The result equally showed a negative impact but statistically insignificant relationship between urban agglomeration and foreign direct investment. Also, a statistically significant and positive relationship was recorded between economic growth an...

The purpose of this study is to analyze the determinant of economic growth in the region of East African countries from 2002 to 2018. In order to investigate empirically the key determinants of economic growth in East African countries, this study used a dynamic panel model. To improve efficiency, Generalized Moments Method (GMM) estimators are used. Based on panel data from the East African countries during the 2002-2018 period, this study, therefore, estimated the determinants of economic growth in the region. The result suggests that government expense, government revenue, volume of imports and exports of goods and services significantly contribute to the economic growth of the countries. However, the consumer price index, current account balance, gross government debt, and foreign direct investment lead to negative economic growth. The paper has three policy implications; first, promoting open trade and ensuring peace and stability in the region is a paramount policy to enhance the economic growth of the region. East African Countries should move forward in creating stability regionally and internally within the countries. Second, countries in East Africa are recommended to strengthen and sustain their policies on government expenses, government revenue and revise their policies on government debt, inflation and current account balance. Major reforms are required in foreign direct investment and general government debt within the region. Third, to address obstacles in trade, climate change and the tax collection system, political and economic integration is fundamental to the region and to making the region competitive in the international trade arena.

GVU Journal of Management and Social Sciences , 2023

This study set out to examine the factors that determine economic growth in Sub-Saharan Africa with special emphasis on the Middle Income Economies. Panel data were collected from 23 countries in SSA from 1996 to 2020. Fixed effect and random effect method of analysis were employed for the analysis. The findings revealed that GDP per-capita, Gross Fixed Capital Formation, Population growth, exchange rate and Foreign Direct Investment have positive and significant effects on the economic growth. Based on these findings, the researchers recommended that there is need for SSA countries to improve on their fixed asset as this will boost economic growth.

SGOJAHDS, 2024

This research explores the link between urbanization and economic growth in Lagos, Nigeria, over the period of 1980 to 2020, utilizing a historical research methodology. Lagos has transformed into one of the largest urban centers in Africa, becoming a key economic hub due to its rapid urban expansion. This growth has been fueled by factors such as migration, industrialization, and the development of infrastructure. However, the city's swift urbanization has introduced a range of challenges, including overcrowding, insufficient infrastructure, environmental degradation, and growing inequality, all of which have complicated efforts to sustain its development. The paper investigates how urbanization has contributed to economic progress, particularly in sectors like manufacturing, trade, and services. It also examines the key obstacles arising from this growth and the various governmental policies and strategies put in place to address them. The study evaluates the role of these policies in managing the impacts of rapid urban expansion and highlights the importance of sustainable urban planning for the future of Lagos State. By studying Lagos as a case, the paper offers insights into broader urbanization trends in sub-Saharan Africa, emphasizing the balance between economic growth and social challenges. The research argues that while urbanization has been a powerful driver of growth, it is vital to ensure that the benefits are distributed equitably and that the environmental and infrastructural challenges are addressed effectively for continued progress.

2015

Patterns of urbanization in Africa have been found to be different compared to the developed world: urbanization in Africa is much more concentrated in a few large cities. This may be driven by political economy channels, which should weaken following institutional change. Using a wave of democratic transition during the 1990s we study whether urbanisation has become more evenly spread across cities in Africa. We find that following democratic transition there is significant catch-up growth in non-capital cities as measured by night lights data. We also document a significant improvement in delivery of education services in secondary cities relative to the capital city.