Since 1992 Ethiopia has been engaged in liberalizing its financial sector. The hallmark of the strategy is gradualism. The approach is not without problems especially from Bretton Woods Institutions that saw the reform as a sluggish process. This study examines this liberalization program by...

This paper uses inequality decomposition techniques in order to analyse the consequences of entrepreneurial activities to household income inequality in southern Ethiopia. A uniform increase in entrepreneurial income reduces per capita household income inequality. This implies that encouraging...

This is the first paper using household survey data from two countries involved in an international war (Eritrea and Ethiopia) to measure the conflict's impact on children's health in both nations. The identification strategy uses event data to exploit exogenous variation in the conflict's...

Rapid urbanization is an important characteristic of African development and yet the structural transformation debate focuses on agriculture's relative merits without also considering the benefits from urban agglomeration. As a result, African governments are often provided conflicting...

In 1991 the Ethiopian Revolution Democratic Front (EPRDF) toppled the old ‘socialist’ regime that had ruled the country for seventeen years. In contrast to the previous policy regime of hard control, EPRDF initiated a wide range of reforms that covered not only the tax system but also the...

This paper investigates the determinants of the real exchange rate (RER) in Ethiopia. In particular, it assesses whether large capital inflows (e.g. foreign aid and remittances) have an impact on the RER. This empirical exercise tries to improve the current literature in a number of ways: (i)...

This paper uses the cointegrated vector autoregressive (CVAR) model to assess the dynamic relationship between foreign aid inflows, public expenditure, revenue and domestic borrowing in Ethiopia. It departs from the existing literature by using a unique quarterly fiscal dataset (1993-2008) and...