Does government debt affect private investment?
Does government debt affect private investment?
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Date
2019
Authors
Gyimah, Prince
Akoto, E
Owusu, E.
, Acheampong, A
Adu-Brobbey, V
Journal Title
Journal ISSN
Volume Title
Publisher
EuroMed J. Management
Abstract
This paper examines the nexus between government debt and
private investment in developing market, Ghana. Specifically, we examine the
link between external debt, gross domestic product (GDP), net tax, inflation,
domestic credit, exchange rate, interest rate, and constitutional government on
private investment. We use time series data ranging from the period of 1975
to 2014. Augmented Dickey Fuller test, vector error correction model, and
Granger causality are used to test co-integration, long run relationships and the
short run relationships, respectively. We find that external debt, domestic credit
and constitutional government are positively linked to private investment.
GDP, net taxes, inflation, exchange rate, and interest rate are negatively
related to private investment in the long run. Our contribution is that external
debt crowds in private investment in the long run in the developing country
perspective.
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Citation
Akoto, E., Owusu, E., Gyimah, P., Acheampong, A., & Adu-Brobbey, V. (2022). Cultural Profile as Determinant of Work Outcomes in a Collectivist Context. Journal of Global Awareness, 3(2), 1-24.