Browsing by Author "Eshetu, Antehun"

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    The Effect of External Debt on Private Investment in Sub- saharan Africa
    (A.A.U, 2021-06) Eshetu, Antehun; Gebremeskel, Atnafu (Dr)
    This study investigate the E ect of External debt on Private Investment in Sub Sa- hara.The objective of the study is to investigate whether the SSA external debt burden has contributed to weak private investment in the country. For this purpose, two hypothe- ses need to be tested. First, the debt-service ratio is expected to have a negative e ect on private investment. Second, public investment is hypothesized to have positive e ect on private investment. The study is carried out using the GMM and FE the time series panel data analyzed cover the period 2000 - 2019. Gross private investment (PRI) is speci ed as a function of the debt-service ratio (DSR), gross public investment (PUI), External debt stock (ED), GDP rate (GDPr), credit to private sector (CPS). The em- pirical ndings provided evidence for debt overhang problem of the external debt stock accumulation. However, the empirical analysis reveals that the debt service ratio crowds out private investment as hypothesized. This would mean that the scarce resources avail- able in the country are being used to meet the external debt obligations instead of being allocated to productive investment. Moreover, the results con rmed the positive impacts of public investment on private investment. The positive impact of public investment on private investment could also be witness for the absence of crowding out e ect of external debt servicing. The econometric nding with respect to private sector credit also suggested the positive contribution on the private investment in sub Saharan African countries. All in all, the study concludes that the external debt stock overhang and external debt service ratio crowds out private investment in Sub Saharan Africa. While the Government rec- ognizes the private sector to be the key engine of economic growth and poverty reduction, policy makers should raise productivity of capital and increase the demand for the private sector output. To this e ect, it is also suggested that more resources should be allocated to the areas of agriculture and infrastructure. These measures would help to enhance conditions meant to attract more private investment in the countries.
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    The Effect of Some Economic Factors on Ination in Ethiopia
    (Addis Ababa University, 2020-07-03) Eshetu, Antehun
    This research looks at the e_ect of some economic factors on ination in Ethiopia.The study was conducted with the target of searching for the relationships that exist between selected economic variables and ination. Thus, this study employed analysis together with Econometric analysis like Johnson co-integration, Vector Error correction model (VECM), Granger causality tests, impulse response and forecast error variance decompo- sition to analysis future and short-run relationship between variables. We have estimated economic variables by using annual statistic data for the amount starting from 1975 to 2019. The empirical results show that real rate of exchange and cash in hand were the variables that are found to own a protracted run signi_cant and positive relationship with the ination and government expenditure and also the long term signi_cant and negative relationship with the ination. In short run the lagged coe_cient of real charge per unit, cash in hand and government expenditure incorporates a positive e_ect on ination. The error correction term the adjustment coe_cient found during this study indicates that a couple of 12% of the variation within the ination from its equilibrium level is cor- rected within a year. The pairwise Granger causality test result suggest that the existence of strong and signi_cant correlation between a uni- directional causation runs from real GDP to ination, funds to ination, government expenditure to ination and ination to real exchange rate per unit. .