Gross domestic savings: what influences it's growth in Kenya?
DOI:
https://doi.org/10.52218/ijbtob.v1i6.148Abstract
The study investigates the factors influencing gross domestic saving growth in Kenya during the period 1989 – 2018 using the McKinnon-Shaw Hypothesis. Ordinary least squares is employed to test for significance of individual parameters which may influence the level of gross domestic savings growth. The results indicate that gross domestic product growth rate, inflation rate and lending interest rate are significant in determining the growth in gross domestic saving. Capital formation was insignificant in influencing the growth in gross domestic saving. The results indicate the need for the government to enhance the prospects of economic growth which will lead to rise in domestic savings. The Central Bank of Kenya, as well, to set lending interest at a rate that encourages saving.
Downloads
References
Apunda, R. (2009). Determinants of Private Savings in Kenya. University of Nairobi press, 1-50
Bol Agoot Arok (2014). Determinants of Gross Domestic Savings in Kenya, MA Thesis, University of Nairobi
Chakrabati, A. (2006). The Savings – Investment Relationship Revisited: New Evidence from Multivariate Heterogeneous Panel Cointegration Analysis. Journal of comparative economics, 34, 402-419.
Ikhide, S., & Alonade, A. (2001). Financial Sector Reforms, Macro -economic Instability and the Order of Economic Liberalization, The Evidence from Nigeria. Economic Research Consortium research. Paper 112.
Keho, Y. (2011). Long-run Determinants of Savings Rates in WAEMU Countries: An Empirical Assessment from ARDL Bounds Testing Approach. South African Journal of Economics, 312-325.
Kibet, L. K., Mutai, B. K., Ouma, D. E., Ouma, S. A., & Owuor, G. (2009). Determinants of household saving: Case study of smallholder farmers, entreprenuers and teachers in rural areas of Kenya. Journal of Development and Agricultural Economics, 137-140.
Krieckhaus, J. (2002). Reconceptualizing the developmental state: public savings and economic growth. World development, 13(10).
Labonte, M.( 2011). Inflation: Causes, Costs, and Current Status. Congressional Research Service,7 (5700).
McKinnon, R., (1973), Money and Capital in Economic Development (Washington: The Brookings Institution).
Modigliani, F. (1966).The Life Cycle Hypothesis of Saving, the Demand for Wealth and the Supply of Capital. ProQuest Information and Learning Company.
Mwega, F.M., Ngola,S.M., & Mwangi, N.(1990). Real Interest Rate and the mobilization of Private Savings in Africa. A case study of Kenya. African Economic Research Consortium, research paper 2.
Nwachukwu, T. E., & Egwaikhide, F. O. (2007). An Error-Correction Model of the Determinants of Private Saving in Nigeria. African Economic Society (AES) Conference (pp. 1-4). Cape Town: Africa Economic Society Press.
Ogero T.M., Obere J.A. & Odada J.E (2021). Relationship Between Foreign Direct Investment inflows and Selected Macroeconomic Variables in Kenya, International Journal of Social Sciences Information and Technology. Retrieved from http://www.ijssit.com
Prinsloo, J.W., (2000).The Saving Behavior of the South African Economy. Occasional Paper No 14, South African Reserve Bank. South Africa.
Samuel, T. K. (2005). Determinants of Aggregate Domestic Private Savings in Kenya, 1980-2003. Kenyatta University Press, 1-78.
Success Abusomwan & Jessy Ezebuihe (2017). Gross Domestic Savings and Gross Capital: What Matters yo Their Formation in an Era of Economic Recession in Nigeria? Oradea Journal of Business and Economics, 2(2) 45-55
