Does the Effect of Different Governance Channels Depend on the Level of Development of African Countries?

Abstract

The level of development of African States is consistent with the discussions surrounding the need for countries in the region to be fully immersed in practical philosophy. Decision-makers must adopt a coordinated strategy to stimulate the sustainable development of their economy; by incorporating various national plans aimed at encouraging well-being into national governance mechanisms. This paper studied the impact of governance on sustainable development. We use a dynamic panel estimation model, incorporating the PCA technique, to group the governance indicators of Kaufmann et al. [1] into three main composite indicators: economic, institutional and political governance. The Pooled Mean Group (PMG) estimate shows that the development level of African countries is strongly influenced by established institutions. In the short- and long-term, various governance indicators (political, economic, and institutional) have a significant impact on human development and the ecological footprint of countries with high levels of development. On the other hand, they can only significantly stimulate development in countries with a medium level of development in the long term. Much more effort should be made in poorly developed countries to address the shortcomings that limit the implementation of laws and the fulfillment of the obligations of companies, the state, and citizens to ensure sustainable development.