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Abstract
This paper addresses the question of whether Africa is an undertrading continent. We answer this question
using a much-improved data set for obtaining predicted trade and by employing methods that correct for
bias in estimates of undertrading. Our results indicate that globally Africa is an underexporter in our
preferred Heckman specification. This result is robust to the addition of various controls and the
application of variants of the gravity model of trade. We also looked for explanations for Africa’s
undertrading. We found that accounting for transport and communication infrastructure reduced the
undertrading effect for Africa, and in some specifications of the gravity model, the under-trading effect
vanished altogether. Results from a semiparametric model provided evidence of significant nonlinear
impacts from infrastructure, and the effects for a large number of African countries was significant and
compared favorably with the marginal effects of infrastructure in countries on other continents and in
comparable income brackets. Using this model we also found evidence of complementarity across
transport and communication infrastructure, implying that much greater impacts will be likely if the
infrastructure are developed jointly rather than in isolation.