The challenge of achieving “growth” without development in numerous developing countries, particularly within the African region, has instigated a discourse on the effects of institutional quality and the macroeconomic environment on the primary drivers of growth and remittance inflows. This paper seeks to scrutinize the interplay between capital inflow, remittances, and economic growth in Sub-Saharan African (SSA) countries, considering the moderating influence of institutional and macroeconomic stability. Employing a balanced panel data set encompassing 24 countries from 2005 to 2019, this study investigates the hypothesis that the impact of capital inflow on economic growth varies depending on the institutional quality and macroeconomic stability of the recipient countries. The study employs a DOLS panel-based cointegration approach, revealing heterogeneous slope coefficients, as evidenced by the slope homogeneity test. Furthermore, the cross-sectional dependence test indicates that the panels are independent across different sections. All variables are I (1), as affirmed by the CADF and CIPS tests for unit root.The cointegration test conducted by Pedroni, Kao, and Westerlund establishes that the examined variables maintain long-term relationships. The long-run estimated coefficients derived from the regression analysis using DOLS cointegration demonstrate a positive correlation between per capita income and remittance when interacted with macroeconomic policy. Consequently, addressing institutional quality and macroeconomic stability is imperative, as they play a pivotal role in moderating the efficacy of remittance inflows and their impact on the economic growth of the region.

This chapter analyzes vulnerability to climate change of Ethiopian farmers across different agroecological zones by constructing composite vulnerability indices, which integrate both the biophysical conditions of the farming regions and the socioeconomic conditions of the farm households. Findings show that, among the four major agroecological zones in the Nile Basin of Ethiopia, the humid lowlands and drought-prone highland areas are the most vulnerable zones. Findings also show that enset-based farming (a local farming system where enset is the dominant crop) in moisture-sufficient highland areas has the highest adaptive capacity, while the humid lowland zone is the lowest in terms of adaptive capacity to climate change. Because there are large spatial differences of vulnerability across agroecological zones, development and rural poverty reduction policies and strategies should be tailored to location-specific circumstances. In particular, great effort should be exerted in expansion of education, training, and extension to marginalized areas. Moreover, public investment in technology and infrastructure is essential to enhance adaptive capacity. Investment in different water, land, and forest conservation programs should be implemented at both community and household levels, in order to lessen sensitivity and exposure to climate risk of rural households in the Nile Basin of Ethiopia.

This study investigates the dynamics and determinants of inflation in Ethiopia over the period 1975-2015 using annual data from the National Bank of Ethiopia (NBE), the Central Statistical Agency (CSA) and the Ministry of Finance and Economic Cooperation (MOFED). The study uses the ARDL inflation model by synthesizing monetarist and structuralist views of the determinants of inflation in the country. The findings show that the major determinants of dynamics of inflation in Ethiopia are both monetary sector and structural factors. Specifically, the ARDL model shows that monetary determinants of inflation are money supply and the real interest rate. Inflation in Ethiopia both in the short and long run is not only a monetary phenomenon (such as money expansion via credit and money printing; government spending and the real interest rate) but also the result of structural factors like shocks to the real sector (mainly agricultural GDP as the agriculture sector dominates the country's GDP). This study's policy implications are that the Government of Ethiopia needs to follow conservative fiscal and monetary policies. It is also important to enhance economic growth as higher economic growth reduces inflationary pressures.