Browsing by Author "Ferede, Tadele (PhD)"
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Item Analysis of Tax Revenue Forecasting In Ethiopia: An Auto-regressive Distributed Lag Approach(Addis Ababa University, 2013-09) Abate, Demeke; Ferede, Tadele (PhD)This study focuses on the investigation of the causal long‐term relationship between tax revenue and nominal gross domestic product in Ethiopia. In this research the analysis of short term relationship also under taken. Using an error correction model (ECM) model with annual data over the last 32 years from 1980/81 to 2012/13, the study found a close relationship between tax revenue and nominal gross domestic product. The size of the long‐term parameters looks acceptable. The estimation technique employed in this research was auto regressive distributed lag integration approach with one period lag length and the result shows GDP and tax revenue own two period lags affects the tax revenue. These variables have also short term causal relationships and their granger causality is statistically significant.Item Can the Monetary Authority Control the Stock of Money Supply in Ethiopia an Empirical Investigation(Addis Ababa University, 2014-06) Desalegn, Gashaw; Ferede, Tadele (PhD)The aim of this paper is to investigate empirically the ability of Nation Bank of Ethiopia to control the stock of money supply. This investigation seems to conform to the ongoing controversy surrounding the exogeneity /endogeneity hypothesis regarding the money supply i.e. the controllability/non-controllability of the money supply by the Central Bank. The paper has first tested the money multiplier model which says money is exogenous and thus controllable by central banks. We examine the constancy and Stationarity of the money multiplier and the results suggest that the money multiplier remains non stationary for the entire sample period. We then tested cointegration between money supply and monetary base and find the evidence of cointegration between two variables. The coefficient restrictions are satisfied only partially. The result from this model shows it will be difficult to use the money multiplier model as a frame work for monetary policy. The paper attempted to test the post-Keynesian hypothesis of endogenous money for Ethiopia using Granger Causality test. We have found that at all level of lag lengths credit causes broad money but at higher lag length broad money do not cause credit in the sample period. Though the result seems gloomy the endogeneity of money supply is strong.Item Impact of Government Expenditure Shock on Private Investment in Ethiopia: A Recursive Dynamic CGE Analysis(Addis Ababa University, 2017-10) Regassa, Haile; Ferede, Tadele (PhD)Impact o f Government Expenditure Shock on Private Investment in Ethiopia: A Recursive Dynamic CGE Analysis Haile Regassa Badassa Ethiopian government targeted sustainable economic growth with stable macroeconomic environment through expanding government expenditure, revenue and private investment. But the relationship between government spending and private investment is source of controversy in both theoretical and empirical perspective. This study examines the impact of government expenditure specifically (human capital, electricity and public consumption) shock on private investment using a recursive dynamic CGE model with the recent SAM of the country. To see the impact of each categories of spending we use four source of finances which include shift of resource from public administration, tax, foreign saving and tax and foreign saving for both human capital and electricity spending but one source which is tax for public consumption spending. Under all sources of finance, human capital and electricity spending exert positive impact on variables under consideration including private investment which easily reconciled with Keynesians argument. But the size of impact of each spending under each source is different. Both human capital and electricity financed via foreign saving bring a greater positive impact on private investment in Ethiopia. In contrast to this, public consumption financed via tax imposes negative impact on all variables including private investment which can be reconciled with neoclassical view. Therefore, financing human capital and electricity spending via foreign saving and decreasing public consumption is sound to bring private investment to desired place in the country Key words: Government expenditure, Private Investment, SAM, CGEItem The Impact of Income Inequality on Economic Growth in Ethiopia: ARDL Approach(A.A.U, 2021-09) Sisay, Andualem; Ferede, Tadele (PhD)Identifying the impact of income inequality on economic growth has paramount importance for shared and broad-based economic growth. Thus this study was conducted to examine the effect of income inequality on economic growth evidence from Ethiopia. To achieve this objective time series data from 1982 to 2019 was used and it is examined by using ARDL estimation technique. Economic growth was used as dependent variable and income inequality, population growth, urbanization, inflation and financial development were used as independent variables. The estimation result revealed that in the long run urbanization, financial development, population growth and income inequality have positive significant effect. While in the short run urbanization and financial development have negative significant effect, but population growth and income inequality have positive significant effect. The coefficient of the ECM is negative 0.913 and this signifies that a deviation from the long-run equilibrium subsequent to a short-run shock is corrected by about 91.3 percent at the end of each year. Based on the findings the study recommends that the government and other concerning body the government has to implement pro-poor strategy to include all section of the economy from the benefits of growth, improving the performance of secondary market.Item The Relationship between Public External Debt and Economic Growth in Ethiopia: Evidence from ARDL Approach to Co-integration(Addis Ababa University, 2016-06) Aweke, Garedew; Ferede, Tadele (PhD)This study is an effort to determine the effect of public external debt on economic growth in Ethiopia. Specifically, the study tries to answer the questions whether stock of public external debt and public external debt servicing has any significance effect on economic growth of the country and it also determined the magnitude of the effect. In doing this, the study used an Auto Regressive Distributive Lag model (ARDL modeling) to analyze Ethiopian data from 1981 to 2014 with GDP per capita as a function of stock of public external debt, public external debt servicing, human capital, physical capital, labor force, trade openness and policy change dummy. The empirical result reveals that in the long-run high level of stock of public external debt has a significant negative effect on economic growth and it poses great challenges on the economy. Therefore there is an evidence for the “Debt overhang” and “Conventional view” of public debt in Ethiopia. On the other hand public external debt servicing has a negative coefficient but insignificant in affecting economic growth and there is no evidence for the “Crowding out” effect in the country. In the long-run result, human capital is also found to have negative impact on GDP per capita. Moreover, Labor force has a significant positive impact but private capital formation and trade openness are insignificant in explaining the Ethiopian economy. Hence, this study recommended the government of Ethiopia and local policy makers to improve the existing policies on public external debt management such as to invest in productive activities and sectors, to implement structural change, public sector reform and tax reform, should try to minimize the dependence on external borrowing through diversifying the economy so as to generate more revenue in the domestic. Key phrases: Public external debt, Public external debt servicing, ARDL and economic growth.