Browsing by Author "Handamo, Firehiywot"

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    The Nexuses between Tax Revenue, Inflation, Private Final Consumption and Economic Growth in Ethiopia
    (Addis Ababa University, 2016-06) Handamo, Firehiywot; Guta, Fantu (PhD)
    The study aims at understanding the nexus between tax revenue, private final consumption, inflation and economic growth in Ethiopia. To achieve this objective co-integrated VAR approach was employed. The estimated models enable to understand the long run and short run relationship of the variables for the period 1970–2015 in Ethiopia. The study have the following major findings: First, Real GDP exert negative and significant effect on real tax revenue in the long run while the impact of the real private final consumption is positive and insignificant in the long run. Second, there is a strong evidence that inflation exert negative impact on real tax revenue. Third, there is evidence of bi-directional causality between real tax revenue, inflation, real private final consumption and real GDP. Fifth, the impulse response function indicates that the variables are at fast movement towards long run time path. The overall findings of the study underlined given the long run negative impact of RGDP on real tax revenue, it will be natural to think of different reforms. Here, Inferences drawn will have implications for all stakeholders in the economy and are particularly useful for fiscal policy makers of the country.
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    The Nexuses between Tax Revenue, Inflation, Private Final Consumption and Economic Growth in Ethiopia: Co-Integrated Var Approach
    (Addis Ababa University, 2007-08) Handamo, Firehiywot; Guta, Fantu (PhD)
    Despite the belief that fiscal policy can influence both economic growth and private investment., attempts like the Structural Adjustment Program and Poverty Reduction Strategic Papers have not yet brought that much promising results in Sub- Saharan Africa. If so, Can policy makers help enhance the performance of private investment in the region through fiscal policy changes? In an attempt to answer this question, annual panel data for the period 1986- 2003 for twenty three countries in the region was utilized. The data set depicted the persistence of heterogeneity among the countries. The fixed effects model was applied based on the specification tests. The regression output indicated that private investment is positively responsive to previous period fiscal policy measures, per capita GDP and its growth rate. However, current period fiscal policy measures, domestic credit to the private sector, real exchange rate, inflation, and the size of government control in the exchange rate market appeared insignificant in affecting private investment in the region. Debt servicing significantly and negatively discouraged private investment, while debt stock was not found doing so. The conclusion is that previous period policy measures are more influential in promoting private investment in Sub Saharan Africa. A high debt servicing reduces resource availability for domestic investment immediately than huge external debt stock, whose repayment may be cancelled, at least based on conditions, as observed in HIPCs case. Key words: - Fiscal policy, panel estimates, private investment, Sub- Saharan Africa