EXPORT INSTABILITY AND ECONOMIC-GROWTH IN SUB-SAHARAN AFRICA

I used data from 34 sub-Saharan African countries and a neoclassical growth equation to investigate the relationships between export instability and economic growth during the 1960-86 period. The method of analysis involved estimating a neoclassical growth equation with export growth and its instability as additional explanatory variables. After allowing for the effects of other variables on economic growth, export instability has a negative and significant effect on the economic growth rate in sub-Saharan African countries. The use of a neoclassical growth equation makes it possible to isolate the effects of export instability on the economic growth rate after allowing for the effects of other variables. The results of this study have development policy implications for sub-Saharan African countries as well as other LDCs, especially in developing and implementing liberal policies that can counter the effects of fluctuations in export earnings. -from Author