Assessing African Regional Integration Potential: A Data Envelopment Analysis.

Assessing African Regional Integration Potential: A Data Envelopment Analysis

by Dr. Karim Nchare (University of Princeton, USA)

Tue, June 29, 16:00 - 17:15, Zoom 683 2395 8657, Passcode: 839949 (RS Affiliations)

Abstract

This project proposes a quantitative approach to estimate untapped regional integration potential across the African Continent. We first construct an empirical production possibility frontier for regional integration outcomes based on two composite indices capturing respectively enabling factors and achieved levels of regional integration outcomes across various domains. As the composite index of achieved regional integration, we use the African Regional Integration Index (ARII) which aggregates information from various empirical indicators covering five dimensions of regional integration: trade integration, productive integration, macroeconomic integration, infrastructural integration, and movement of people. We then use data envelopment analysis to rate the performance of subregions in terms of integration relative to their estimated potential. The obtained efficiency scores allow us to quantify and compare the empirical magnitudes of untapped integration potential across countries and subregions. From a policy perspective, the proposed approach can be used to assess achievements in targeting subregions with certain needs and in identifying appropriate policy interventions that aimed at fostering higher integration in each subregion.