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This study examines the roles of government spending and money supply onalleviating poverty in Africa. The study used 48 Sub-Saharan Africa countriesfrom 2001 to 2017. The study employed one step and two-step system GMM andfound that both the procedures have similar results. Different specificationswere employed and the model selected was robust, with valid instruments andabsence of autocorrelation at the second order. The study revealed thatgovernment spending and foreign direct investment have significant negativeinfluence on reducing poverty while money supply has positive influence on thelevel of poverty in the region. The implication of the finding is that monetarypolicy tool of money supply has no strong influence in combating the menace ofpoverty. The study therefore recommends that emphasis should be placed onincreasing more of government spending that would impact on the quality of lifeof the people in the region through multiplier effect, improving the financialsystem for effective monetary policy and attracting foreign direct inflowsthrough enabling business environment in Africa.

Government Spending and Money Supply Roles in Alleviating Poverty in Africa