Economics

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Export Instability and Economic Growth in Ethiopia
(A.A.U, 2001-06) Abdella, Amin; Seyoum, Alemayehu (Dr)
The study tried to examine the relationship between export earning instability and economic growth in Ethiopia using relatively long time series data; and assessed the political economy factors worsening coffee sector performance and thereby instability in the export earnings of the country. Export earnings instability in many primary commodity producing LDCs has been found to affect their economies adversely, the positive relationships found in some cases, however, are criticized for their mis-specification of the equation to be estimated and the technique used in constructing the instability index. The instability in the export earning analyzed in this paper is found to have an adverse effect on the growth of the economy in the short run. The long run effect though happened to be adverse it is so insignificant to affect the economy. The political economy assessment gave the vision that the external shocks and bad domestic policies have resulted in lower farm gate prices thereby the production and export of coffee than would have been if these influential policies weren't in action.