Sawkut Rojid

The determinants of FDI in Mauritius: a dynamic time series investigation

Purpose – The purpose of this paper is to supplement the literature on the determinants of foreign direct investment (FDI) by bringing new evidences for the case of a successful FDI recipient country in Africa, namely Mauritius.Design/methodology/approach – The determinants of FDI are examined by specifying a reduced‐form specification for a demand for inward direct investment function, and by making use of a dynamic framework. In the absence of cointegration, a differenced vector autoregressive (DVAR) model is used to capture the short‐run dynamics of the growth rate of the different specified variables.Findings – The most instrumental factors appear to be trade openness, wages and the quality of labour in the country. Size of the market is reported to have a relatively lesser impact on FDI, probably related to the limited size of the population and the domestic market on the one hand and the good export opportunities from Mauritius on the other. The significant coefficient of the lagged dependent variab...

The impact of relative prices on tourism demand for Mauritius: An empirical analysis

The present study assesses the impact of relative prices on tourism flows in Mauritius. To account for dynamism in tourism flows modelling, a dynamic time series analysis – namely the vector autoregressive model – is employed. The results show that relative price measures have a long-run impact on international tourism flows, indicating that tourists are sensitive to price levels. The relative average cost in the different competing destinations is also reported to be positive and significant, indicating that the impact of relative price changes in foreign destinations competing with Mauritius tourism matters; thus indicating a certain degree of substitutability between Mauritian and its regional competitors’ tourism. Tourism infrastructure, income in country of origin and the islands level of development are confirmed to be key factors in the tourist selection decision. Finally, overall, short-run estimates confirm the above results.

Analysing the Sources of Economic Growth in Africa Using Growth a Accounting and a Panel VAR approach

Using growth accounting framework and panel data analysis, while accounting for dynamics and endogeneity issues in growth modelling, this paper analyses the sources of growth in selected COMESA member countries. The growth accounting suggests a moderate level of TFP and that the contribution of capital and labour has been more or less the same. The results from the econometrics study are also along the same line with capital accumulation, openness and education observed to be among the most important ingredient of growth. The econometric study has also shown the importance of some other variables like political and institutional stability, financial development, IMF assistance funds and spill over effects as potential factors that may affect growth.

Roads and Poverty: New Evidences from Africa

Urban poverty, as well as the role of transport in addressing it, has not figured largely in the assessment of poverty in Sub-Saharan Africa. This article bridges the gap by exploring the impact of transport infrastructure on the urban poor in a sample of 15 Sub-Saharan African countries, over the period 1980 to 2000. The results from the fixed effect and dynamic panel models reveal that transport infrastructure in the form of paved road length is indeed an efficient tool in fighting urban poverty. Hence the main policy concern is how to improve access of the urban poor to such an asset.

Training Funds and the Incidence of Training: The Case of Mauritius.

Training funds are used to incentivize training in developing countries, but the funds are based on payroll taxes that lower the return to training. In the absence of training funds, larger, high-wage and more capital-intensive firms are the most likely to offer training unless they are liquidity constrained. If firms are not liquidity constrained, the fund could lower training investments. Using an administrative data set on the Mauritius training fund, we find that the firms most likely to train pay more in taxes than they gain in subsidies. The smallest firms receive more benefits than they pay in taxes.