Econometric analysis can make a valuable contribution to the understanding of the policy challenges in Africa because it is the key research tool available to economists for the testing of hypotheses against the data, for establishing causal relationships and for the measurement of relationships posited by economic theory.
In the final analysis, if we want to strengthen our analysis of economic relationships, there is no substitution for taking theory to the data in a statistically rigorous manner. Econometrics is also a valuable tool for aiding economic forecasting, which is essential for policymaking in many areas.