Local government, economic growth and human development: Chinese lessons for Kenya and Uganda?

Lead Research Organisation: University of Nottingham
Department Name: Nottingham University Business School

Abstract

Many African states are weak and unstable, prone to military coups or civil unrest. Poor governance and a lack of the civil society necessary to underpin reform are often cited as key reasons why investors are reluctant to engage with Africa and why livelihoods are diminished. The socio-political system in China is also woefully lacking by the standards of liberal democracy, but nonetheless has proved capable of sustained economic reform and remarkable success in development.
During the process of a nation's development, local governments can be important actors in adopting and implementing policies which would assist national economic growth and promote local benefits. For much of China's economic reform period, local governments played a key part in driving GDP growth although there are now doubts about whether this role is sustainable. In Africa, decentralization is a common element of reform but often the focus is on fostering political settlements and improved service delivery, rather than promoting economic reform. This project will consider whether China's experiences provide insights into how local government in Africa may successfully contribute to development, although differences in political structures mean that not all lessons may be transferable. The project will conduct rigorous analysis, based on evidence from original data collection using tailor-made surveys, to explore the impacts of local governance on the economic and human development of China and two selected African countries, Kenya and Uganda.
The research covers four interlinked topic areas. First, it starts with research on a stratified random sample of local governments in the three countries, identifying and comparing their policy environments, structures, inter-government relationships, and key officials' self-motivation for pro-poor growth, and evaluating their performance and policy outcomes. Second, it extends from the analysis of local governments to investigate their impacts on local economic growth and on production of tradable goods, whether in agriculture or manufacturing. Third, the project explores the effectiveness and efficiency of local government in providing health and education services. Fourth, it will consider the impact of local government on poverty reduction.
The project addresses questions which would have impact on policy-making in international development. Differences in the roles of local government between and within countries will be identified, with comparisons being made to explain the challenges facing local governments in the three selected countries. Any lessons, positive or negative, from China's development process will be identified and consideration given to how these might be adapted or avoided in order to enable local governments in Kenya, Uganda and other low income African states to be proactive in economic development.
Intellectually, the project will address some of the big questions and puzzles in development economics: why did China benefit from export oriented industrial growth but not Africa? How has China achieved economic liberalisation and growth without political liberalisation and while still denying the formation of a civil society? Could Africa adopt economic elements from this development model while having a fundamentally different political-social structure? While the industrialised world suffers economic stagnation, can Africa's recent renaissance continue and possibly become the world's next growth miracle? By shifting dogma and policy, could Africa accelerate its growth? When tackling such questions, could we turn to the 'Chinese model' for possible solutions?
The research team comprises well-regarded development economists from Kenya, Uganda, China and the UK. The findings of this project will be likely generate high impacts through the team's networks of international policy makers in the World Bank, DfID, UNDP and the governments of Kenya, Uganda and China.

Planned Impact

The direct and immediate beneficiaries of this proposal would be the national and international organisations concerned with development policies in China and Africa. Among international development agencies, the proposed research is targeted at the World Bank, UNDP, ILO, Africa Development Bank, Britain's Department for International Development and the European Union.
The project has formed its team with a record of policy impact. Team members are all publishing academic papers with high policy impacts; and most regularly serve as consultants for the international policy makers listed above. Justin Lin, the former World Bank Vice President, will play the key role in disseminating the project findings among such organisations. Xiaobo Zhang has worked for decades in the International Food Policy Research Institute (IFPRI), in the USA, a key research institute for international development; he will bring in renowned development economists to join the dissemination events organised by the project. Song, Appleton, Mwabu and Kasirye have good contacts with ministries, NGOs, and other stakeholders in China, Kenya and Uganda. They have the standing to attract national policymakers to attend the dissemination events and to engage with project policy briefs.
Users from China will benefit from this project. For example, China Enterprise Association (CEA), which advises large Chinese State firms on investment and corporate social responsibility programmes in Africa, would be actively involved. The China Development Bank is the major vehicle for the Chinese government to invest in Africa. Its former Chairman of the Board, Mr Yuan Chen, would be involved in dialogue with the team. Key members of the two organisations will be invited to attend project events.
The project would engage users in Africa through the team's wide range of networks in the region. Germano Mwabu is a leading member of the African Economic Research Consortium and Ibrahim Kasiyre is Head of the Micro Department of the Economic Policy Research Centre, the main economic policy think tank in Uganda. NGOs and practitioners actively working on improvement of health, education and women's rights in Africa would be invited to participate in project activities and engage with the research findings produced.
The business communities globally could benefit from the project. Improved understanding of Africa would help them to increase business performance and competitiveness when doing business in the region.
Last and, most important, people in low income African countries would benefit from the project's research targets and outputs. The overarching goal of this project is to increase the general level of welfare in Africa by improving policy making and implementation in the sub-continent, especially at the local government level. The project would seek, and test, which governance models would accelerate economic growth, reduce poverty and enhance human development. If the project does uncover lessons from China for Africa, this could be transformative - facilitating manufacturing, agricultural innovation and FDI. The project's focus on effective public service delivery could improve the quality of life for Africans, with improved education and health care.
The project would create a web-site, issue regular policy briefs, encourage its team members to attend international workshops and conferences, and mostly importantly to discuss its research findings with policy makers. In the first year of the project, stakeholder workshops would be run in both Africa and China. Two international conferences for disseminating the project findings will be organised. In 2017 (third year of the project), a high-level conference will be held either in Kenya or Uganda to convene findings with invitees from the World Bank, IFPRI and government officials from China and African countries. Towards the end of the project (2018), a final conference will be organised in China
 
Description The functions of the formal sector may be explained differently from conventional economic theories. In addition to being a hub for vulnerability, informal employment may be seen by some as an optimal choice. This finding will be further developed in our study testing the role of local governance and estimating how labour market is performed under various type of governance. This may be particularly interesting if we can examine whether local governance in Kenya or Uganda would generate similar results in resolving unemployment related issues as what we find in China. There are other main findings from last year (2016-17). Through our experimental research in China and Uganda, we find that an environment of corruption corrupts the citizens. We also find that government intervention by utilising school invigilation over teachers' attendance would improve students' learning in Uganda. The childcare provided by grandparents becomes common in China, we find that without further training of grandparents, children of China under grandparent care would develop less well than those under parental care in terms of physical abilities and learning outcomes.
Exploitation Route Yes, we will use our findings to alert the policy makers and to conduct more policy-relevant research projects. This will start from mid-2018.
Sectors Communities and Social Services/Policy,Education,Financial Services, and Management Consultancy,Healthcare,Government, Democracy and Justice

 
Description Collaboration with policy makers in China, Uganda and Kenya
Geographic Reach Multiple continents/international 
Policy Influence Type Implementation circular/rapid advice/letter to e.g. Ministry of Health
Impact We are in the middle of negotiation to establish a field experimental research centre at one of Chinese universities to conduct RCD / policy interventions; this should start with the project finding and covering the regions of China, and possibly in Kenya and Uganda. The project CoIs from Uganda and Kenya will visit China within the next few months.
 
Description "Equity for public health care provision to the vulnerable"
Amount ¥300,000 (CNY)
Organisation National Health and Family Planning Commission of the People's Republic of China 
Sector Public
Country China
Start 11/2017 
End 11/2018
 
Description Six months' post-doc fellowship
Amount ¥200,000 (CNY)
Organisation University of Nottingham 
Sector Academic/University
Country United Kingdom
Start 12/2017 
End 06/2018
 
Description Field Expereimental Research Centre at Zhongnan University of Economics and Law 
Organisation Zhongnan University of Economics and Law
PI Contribution I am in the preparation for the establishment of the centre now, and will provide detailed support in the summer school to train Chinese scholars.
Collaborator Contribution The partner will provide administrative support to me and to those related to the project. The cost to be covered include travel, accommodation and assistance for any related work.
Impact Joint data collection of Chinese household surveys (2018) on the issues of Income distribution; Summer School training on experimental research
Start Year 2018
 
Description dissemination of the project finding within a conference 
Form Of Engagement Activity Participation in an activity, workshop or similar
Part Of Official Scheme? No
Geographic Reach International
Primary Audience Professional Practitioners
Results and Impact An international conference organised by the PI on 6-7 Sept 2017 titled " China at the Crossroads: Economic Challenges and Opportunities" at the University of Nottingham. The invited speakers are all International renowned scholars including Professor Justin Yifu Lin ( Project CoI, fromPeking University), Professor Weiying Zhang (Peking University), Professor Scott Rozelle (Stanford University), Processor Yaohui Zhao (Peking University, China Health and Retirement Longitudinal Study Data Lead), Professor Li Shi (Beijing Normal University, Chinese Household Income Project Data Lead), Professor Xin Meng (National University of Australia, RuMic Data Lead) and Professor Bob Gregory (National University of Australia). The Chinese Ambassador to the UK, Dr Liu Xiaoming addressed to the conference. Two papers produced by this project were presented at the conference.
Year(s) Of Engagement Activity 2017
URL https://www.nottingham.ac.uk/business/businesscentres/crg/index.aspx