Governance and Development Performance: A Cross-Country Analysis of Sub-Saharan Africa

Abstract

Based on a panel data analysis of 21 Sub-Saharan Africa countries for the period 1998- 2007, we examined therelationship between governance and development performance following World Bank observation linkingAfrica’s development problems to governance crisis. We use the datasets from Worldwide Governance Indicatorsto measure the quality of governance and investigate the hypothesis that governance matters for development.We find that the rule of law, regulatory quality and political stability are positive and significantly associatedwith development outcomes. The results suggest that the aspect of governance relevant to SSA has to do withstrong rule of law, regulatory framework and political stability with the usual policy prescription of institutionalreforms for re-invigorating development in the region.

Keywords: Governance; Development; Sub-Saharan Africa; Panel Data Analysis; Institutional Reforms.