As the world enjoys greater financial globalization, developing countries continue to accumulate sovereign debts. Despite the promise of sovereign debt to raise national output, and improve the lives of the “have-nots”, income inequality has widened and continues to rise within and among countries. This is suggestive of debt that undermines justice in the distribution of incomes. This essay analyzes the extent to which accumulation of sovereign debt affected income inequality in the East African region. The global financial crisis evidenced in the year 2008 serves as a benchmark. The analysis covers the period from 1996 to 2022. The system generalized method of moments reveals that accumulation of debt was overbearing among the poorest 10percent. Income inequality rose as debt increased, suggesting that as the stock of debt rose, incomes among the poorest decile decayed faster than incomes among the richest 10percent. This effect was dampened by the global financial crisis.

This paper examines the impact of international tourism on tax revenues in African countries using data from 1990 to 2020 and an instrumental variable fixed effects model. The study finds that tourism receipts have a positive and significant effect on nearly all tax revenues, except personal income tax. Additionally, this impact is influenced by factors such as income level, institutional stability, and the presence of a coastline, indicating that advanced economies with stable institutions and coastal access benefit more from tourism. The results suggest that African governments should implement clear tourism development strategies to enhance infrastructure and destination competitiveness. Furthermore, strengthening tax administrations is recommended to fully capture the economic benefits of tourism. Overall, international tourism is portrayed as a vital tool for diversifying African economies, creating jobs, and reducing the size of the informal sector.

This paper evaluates the administrative costs of delivering social protection programmes in Sub-Saharan Africa and Latin America, integrating real-world estimates into SOUTHMOD tax-benefit microsimulation models. We focus on five programme types—means-tested, proxy-means-tested, non-means-tested, and in-kind benefits as well as public works—and assess how administrative costs shape total spending and reduce the effectiveness of poverty reduction efforts. Our findings show that, even with large overhead, means-tested cash benefits achieve the greatest gains in lowering poverty per budget dollar. Meanwhile, programmes with more complex delivery, namely in-kind transfers, tend to incur higher administrative expenses that diminish their cost effectiveness. Public works initiatives also face overhead but can deliver robust results. Non-means-tested cash benefits are simpler to administer but frequently reach broader population groups than intended. By including administrative costs, policymakers can form clearer budget plans that balance programme design choices against their real impact on fiscal sustainability and social goals.

This paper provides novel evidence on the impact of a prominent place-based policy - Special Economic Zones (SEZs) - on the economic well-being of African households. Exploiting time variation in SEZ establishment on a dataset of repeated cross-sections of households in 10 African countries during 1990-2020, we show that households living near SEZs become wealthier relative to the national average after SEZ establishment. The effect accrues mostly within 10 km of SEZs, is not driven by selective migration, and is accompanied by improved access to household utilities, higher consumption of durable goods, increased educational attainment and a shift away from agricultural activities.