Projects Under Development 

1. Health Pandemic, Job Losses and Recovery in South Africa (with  Kilumelume, M)

The COVID-19 pandemic has caused job losses in most economic sectors worldwide. During the surge of the pandemic, many governments implemented mitigation measures, such as social distancing, stay-home orders (SHOs), and lockdowns, to contain its spread. These measures often altered work conditions, leading certain firms to adopt Work from Home (WFH) practices. Consequently, this created substantial impacts on labor demand and job opportunities. Using unique (confidential) administrative firm job records that span 2018-2022 in South Africa, we document three main findings. First, the pandemic induced a significant reduction in employment opportunities in South Africa, with notable variations between economic sectors. Second, the duration of jobs, both permanent and casual, decreased substantially during the nine months of intense COVID-19 activity. Third, by the end of 2022, jobs and employment opportunities had yet to recover to levels observed before the pandemic. Specifically, employment and working days remain lower, approximately 2 and 4 percent, respectively, compared to the average levels two years before the outbreak. Finally, we document the heterogeneous effects of economic recovery two years after the pandemic. These results underscore the potential short-term adverse effects of the pandemic on employment gaps in key economic sectors in the country. Current working version

2. Political Alignment and Tax Audits: Evidence from South Africa (with Kunal, S  & , Chingwere, J)

How does political alignment with the ruling party influence the audit outcomes of the firms? This paper investigates whether political alignment with the ruling party influences the intensity and outcomes of firm audits in South Africa. Using a regression discontinuity design based on close election results from 2014, we examine how firms are treated in municipalities narrowly won versus narrowly lost by the African National Congress (ANC). We combine detailed audit data with corporate income tax (CIT) returns to assess whether audit frequency, enforcement outcomes, and firm-reported liabilities differ along political lines. Our findings show a marked reduction in audit amounts, number of audit cases, and compliant taxpayers in ANC-aligned municipalities. These effects extend to tax reporting behavior: firms in aligned areas report significantly lower corporate tax liabilities despite exhibiting higher reported sales. This pattern suggests that political alignment dampens enforcement without corresponding decreases in firm performance. The study provides suggestive evidence of regulatory forbearance shaped by political incentives, raising broader concerns about fairness, institutional credibility, and the erosion of tax morale in politically connected jurisdictions. Current working version

3. How do Xenophobic Attacks Affect Demand for South Africa Exports? (with Kazima, M and Mensah, J)

Xenophobic violence poses a persistent threat to social stability and economic welfare, yet its effects on international trade are not well understood. This paper fills that gap by examining how violent xenophobic episodes in South Africa affect demand for South African exports in other African countries. We leverage detailed customs data on all exports  for the period 2011 to 2021 and match these records with the timing of “xenophobia spikes” to implement an event‐study DID design and document the following: (i) Sharp and persistent decline in exports to African partners following major xenophobia attacks. Specifically,  exports to those countries fall by roughly 20-25 percent  relative to the rest of the world four years after an episode. (ii) Losses are concentrated in consumer‐oriented goods (e.g. live animals, dairy, cosmetics, vehicles). (iii) Imports into South Africa remain essentially unchanged, thus suggesting that xenophobic violence acts as a foreign demand shock rather than a supply disruption. Overall, the study provides new causal evidence that domestic social unrest can inflict large, lasting costs on a country’s export markets.  We eventually show that xenophobic attacks undermine trade by eroding foreign buyers’ confidence in South African goods. We also identify reductions in local production and employment as likely channels transmitting these shocks. Working draft coming soon!

4. Can Road Upgrades Improve Local Tax Revenues? (A. Musonera and D. Overbeck)

We examine whether road infrastructure can increase local tax collection in a low-income country setting. Drawing on a novel dataset which combines information on the timing and exact location of all national road networks (Highways) in Rwanda together with a decade of administrative tax records, we estimate significant and sizable positive effect of upgraded highways on surrounding municipalities' tax revenues. These effects increase over time and are particularly pronounced for tax types which are collected and used by local municipalities. Additional analyses point to business creation, employment growth as well as increases in land values around paved highways as important channels. In contrast, we estimate precise null-effects for central government's tax revenues. Overall, these additional tax revenues make up for at least 4 percent of the Highway upgrade total costs. Our evidence therefore suggests that while road investments may not yield substantial central fiscal returns, they play a key role in stimulating local economic activity and enhancing municipal revenue capacity. Full Working Paper, coming soon!

Working Papers

Selected Articles