Fofack, Hippolyte2012-03-192012-03-192009-08-01https://hdl.handle.net/10986/4217In spite of the similarities between Sub-Saharan Africa and the Arab Gulf region (Gulf Cooperation Council states), development policies implemented in these two regions of the world have produced markedly different and even divergent outcomes. While Gulf Cooperation Council states have drawn on hydrocarbon revenues to dramatically transform their economic landscape, Sub-Saharan African countries have exhibited abysmal economic and social outcomes. The remarkable increase in personal income and large current account surpluses in Arab Gulf states is in sharp contrast with widespread poverty and recurrent balance of payments crises in Sub-Saharan Africa. This paper reviews the possible causes of these divergent development paths and discusses the prospects for economic convergence in the new globalization landscape of growing trade ties between the two regions. In particular, it shows that development models underpinned by institutional continuity and intergenerational accountability could enhance long-run growth in Sub-Saharan Africa and income convergence between the two regions.CC BY 3.0 IGOACTUAL VALUESADJUSTMENT MECHANISMSADVERSE EFFECTADVERSE EFFECTSADVERSE SHOCKSASSETSBALANCE OF PAYMENTSBALANCE OF PAYMENTS CRISESBALANCE OF PAYMENTS CRISISCAPITAL ACCOUNTSCAPITAL ACCUMULATIONCAPITAL FLIGHTCAPITAL INFLOWSCAPITAL MARKETSCENTRAL BANKCIVIL WARSCOMMODITIESCOMMODITYCOMMODITY PRICESCOMPARATIVE ANALYSISCOMPETITIVENESSCONSOLIDATIONCORRELATION COEFFICIENTCOUNTRY RISKCURRENT ACCOUNTCURRENT ACCOUNT BALANCECURRENT ACCOUNT BALANCESCURRENT ACCOUNT DEFICITCURRENT ACCOUNT DEFICITSCURRENT ACCOUNT SURPLUSCURRENT ACCOUNT SURPLUSESDEBTDEBT CRISISDEBT RELIEFDEBT SERVICESDECISION MAKINGDEMOCRACYDEMOCRATIC INSTITUTIONSDEPENDENT VARIABLEDEPOSITSDEPRESSIONDEVELOPING COUNTRIESDEVELOPING COUNTRYDEVELOPMENT PATHDEVELOPMENT PATHSDEVELOPMENT POLICIESDEVELOPMENT STRATEGYDISTRIBUTION OF INCOMEDIVIDENDSDOLLAR PEGSDOMESTIC CREDITDOMESTIC DEMANDSDUTCH DISEASEDUTCH DISEASESECONOMIC COOPERATIONECONOMIC DEVELOPMENTECONOMIC DOWNTURNECONOMIC DOWNTURNSECONOMIC GROWTHECONOMIC OUTCOMESECONOMIC OUTLOOKECONOMIC PERFORMANCESECONOMIC POLICIESECONOMIC POLICYECONOMIC POWERECONOMIC PROGRESSECONOMIC RESEARCHECONOMIC STRUCTURESECONOMIC THEORYEMERGING MARKETEMERGING MARKET ECONOMIESEMERGING MARKETSERROR TERMSEXCHANGE RATEEXCHANGE RATESEXPLANATORY VARIABLEEXPLANATORY VARIABLESEXPORT BASEEXPORT COMMODITIESEXPORT EARNINGSEXPORTEREXPORTSEXPOSUREEXTERNAL BORROWINGEXTERNAL DEBTEXTERNAL DEFICITEXTERNAL FINANCEEXTERNAL FINANCINGEXTERNAL POSITIONFEDERAL RESERVEFEDERAL RESERVE BANKFISCAL DEFICITSFOREIGN ASSETSFOREIGN CURRENCYFOREIGN DIRECT INVESTMENTFOREIGN DIRECT INVESTMENTSFOREIGN RESERVESFUTURE RESEARCHGDPGDP PER CAPITAGLOBAL CAPITALGLOBAL CAPITAL MARKETGLOBAL CAPITAL MARKETSGLOBAL DEMANDSGLOBAL ECONOMYGLOBAL IMBALANCESGLOBAL STANDARDSGLOBALIZATIONGOOD GOVERNANCEGOVERNMENT BUDGETSGRAVITY MODELGROSS CAPITAL FORMATIONGROSS DOMESTIC PRODUCTSGROWTH PERFORMANCEGROWTH POLICIESGROWTH RATEGROWTH RATESHUMAN RIGHTSIMBALANCESIMPORTSINCOMEINCOME GROWTHINCOME LEVELSINDEBTEDNESSINSTITUTIONAL ENVIRONMENTINSTITUTIONAL MODELSINTEREST INCOMEINTEREST INCOMESINTERNATIONAL BANKINTERNATIONAL DEBTINTERNATIONAL ECONOMICSINTERNATIONAL FINANCEINVESTMENT RATESLABOR FORCELABOR MARKETLIFE EXPECTANCYLIVING STANDARDSLONG-TERM INVESTMENTSM2MACROECONOMIC PERFORMANCEMANUFACTURING INDUSTRIESMARGINAL PRODUCTMARGINAL PRODUCTIVITYMARGINAL PROPENSITY TO IMPORTMIDDLE-INCOME COUNTRYMISMANAGEMENTMONEY CREATIONMONEY SUPPLYNATIONAL DEVELOPMENTNATIONAL INCOMENATIONAL OUTPUTNATIONAL SAVINGNATURAL RESOURCENATURAL RESOURCESNET CAPITALOIL EXPORTSOIL PRICEOPPORTUNITY COSTSOPTIMAL ALLOCATIONOUTPUT GAPOUTPUT PER CAPITAOUTPUT RESPONSEPER CAPITA INCOMEPER CAPITA INCOMESPERSONAL INCOMEPOLITICAL ECONOMYPOLITICAL RISKPOLITICAL STABILITYPORTFOLIOPOTENTIAL OUTPUTPOVERTY REDUCTIONPRICE HIKESPRIVATE CAPITALPRIVATE INVESTMENTPRIVATE INVESTMENTSPRIVATE SECTOR DEVELOPMENTPUBLIC INVESTMENTPUBLIC INVESTMENTSPUBLIC SPENDINGRATE OF GROWTHREAL EFFECTIVE EXCHANGE RATERENT SEEKINGRESERVE ACCUMULATIONRESERVE HOLDINGSRESPONSE TO SHOCKSRISK EXPOSURESAVINGSSOCIAL COSTSSTANDARD DEVIATIONSTATE CAPTURESTATIC ANALYSISSUSTAINABLE DEVELOPMENTSUSTAINABLE GROWTHTOTAL EXPORTTOTAL EXPORT REVENUETOTAL EXPORTSTOTAL IMPORTSTOTAL RESERVESTRADE DEFICITTRADE DEFICITSTRADE SHOCKSTRADESTRADING PARTNERTRADING PARTNERSUNEMPLOYMENTUNEMPLOYMENT RATESVOLATILITYVOLUME OF TRADEWEALTHWORLD DEVELOPMENT INDICATORSWORLD ECONOMIESWORLD ECONOMYWORLD PRICESWorld Bank10.1596/1813-9450-5025