The Nexus between Government Investment Expenditure and Private Investment in Ghana

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Date
2016-02
Journal Title
Journal ISSN
Volume Title
Publisher
European Journal of Social Sciences
Abstract
This study employs both ARDL model and Granger causality test to examine and test the direction of causality between government investment expenditure and private investment in Ghana for the period 1970 to 2013. The study revealsthat, in both long run and short run, government investment expenditure has an insignificant negative impact on private investment. It is also established that there isa bi-causal relationship between government investment expenditure and private sector investment in Ghana. Based on the bi-causal relationship, the study advocates the need for government to invest more in physical infrastructure and human capital in order to reverse the negative and insignificant effect of government investment expenditure on private investment.
Description
Article published in the European Journal of Social Sciences, 2016
Keywords
Government investment expenditure, private investment, ARDL, Granger causality
Citation
European Journal of Social Sciences Vol. 51 No 2 pp.193-205
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