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Economic complexity and inclusive growth in Sub-Saharan Africa: A cross country analysis

The concept of economic complexity is a relatively new term in economics literature, it is used to refer to the magnitude of productive knowledge or capabilities embedded in society. However, because of its potential impact on national prosperity, it is hypothesised that differen ces in the degree of economic complexity are major factors
of inequalities in the growth rates of nations. The approach of economic complexity makes use of fine grained data on thousands of economic activities to learn both abstract factors of production a nd the way they combine into thousands of outputs However, it is only in recent years that studies have started to consider the association between economic complexity and economic growth. As such, there is a lack of robust, vigorous literature that exami nes the association between economic complexity and inclusive growth, particularly in the context of Sub Saharan Africa.
The extant literature focuses on the relationship between economic complexity and isolated cases of some macroeconomic indicators of gr owth. As a departure from the existing studies and as a contribution to the field, inclusive growth, in this study, is measured as a composite index from various growth indicators as postulated in
the inclusive growth theories and then each indicator is v iewed separately. Thus, the general purpose of the study is to investigate the relationship between economic complexity and inclusive growth in Sub Saharan Africa from 1996 to 2019 which is the primary objective of the study. The first objective of the study is to examine the effect of economic complexity on welfare indicators in Sub Saharan African countries from 1996 to 2019. In examining the effect, the study employed a Pool Mean Group Autoregressive Distributive Lag (PMG ARDL) model. The results of the study reveal that economic complexity, economic growth rate, and terms of trade have a positive and statistically significant long run impact on welfare in Sub Saharan Africa. The short run dynamics reveal that economic comp lexity has a negative and significant effect on welfare. The second objective of the study examines the impact of economic complexity on economic indicators in Sub Saharan African countries from 1996 to 2019. To examine the impact, the study employed Panel Ordinary Least Square (POLS) model. The results of the study demonstrate that economic complexity, foreign direct investment, inflation and population growth have a negative and significant impact on the the economic index. However, government expenditure demeconomic index. However, government expenditure demonstrates a positive and onstrates a positive and significant effect on economic indicators. significant effect on economic indicators. The third objective of the study examines the effect of economic complexity on The third objective of the study examines the effect of economic complexity on human development in Subhuman development in Sub--Saharan African countries from 1996 to 2019. In Saharan African countries from 1996 to 2019. In examining the effect, the study eexamining the effect, the study employed Panel Dynamic Ordinary Least Square mployed Panel Dynamic Ordinary Least Square (DOLS) model for the long(DOLS)

Full Name
Dr Chuma Maxwele
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