The causal relationship between private and public investment in Zimbabwe

Muyambiri, B., Chiwira, O., Ngonidzashe, C. and Enowbi Batuo, M. 2012. The causal relationship between private and public investment in Zimbabwe. British Journal of Economics, Management & Trade. 2 (3), pp. 239-264. doi:10.9734/BJEMT/2012/1213#sthash.vRIGH6Eu.dpuf

TitleThe causal relationship between private and public investment in Zimbabwe
AuthorsMuyambiri, B., Chiwira, O., Ngonidzashe, C. and Enowbi Batuo, M.
Abstract

Aims: The study examines the relationship between private and public investment in Zimbabwe utilizing yearly time series data for the period 1967 to 2004.

Study Design: Time Series Study.

Place and Duration of Study: Zimbabwe, May 2011 to July 2011.

Methodology: Emphasis is placed on the direction of causality and the long run and short run effect of the two types of investment on each other. The paper constructs empirical models for both private and public investment, based on the flexible accelerator theory. Private investment is found to be cointegrated with public investment. A cointergration and VEC models are employed to assess the long and short run

relationship existing between public and private investment.

Conclusion: The relationship between private and public investment is found to be insignificant and the direction of causality found to be unidirectional. The results support the notion that private investment precedes public investment.

JournalBritish Journal of Economics, Management & Trade
Journal citation2 (3), pp. 239-264
ISSN2278-098X
Year2012
PublisherSCIENCEDOMAIN international
Digital Object Identifier (DOI)doi:10.9734/BJEMT/2012/1213#sthash.vRIGH6Eu.dpuf
Publication dates
Published22 Sep 2012

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