The impact of public spending on roads infrastructure on Malawi's economic growth

 

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dc.contributor.advisor Gossel, Sean J en_ZA
dc.contributor.author Makhwatha, Alex Simeon en_ZA
dc.date.accessioned 2018-11-07T13:03:39Z
dc.date.available 2018-11-07T13:03:39Z
dc.date.issued 2015 en_ZA
dc.identifier.citation Makhwatha, A. 2015. The impact of public spending on roads infrastructure on Malawi's economic growth. University of Cape Town. en_ZA
dc.identifier.uri http://hdl.handle.net/11427/29036
dc.description.abstract Public expenditure has been a cardinal objective of all successive governments since Malawi gained its independence in 1964. Successive administrations have on different occasions made attempts to direct government spending towards achieving objectives that have direct bearing on its populace. According to Keynesian view, the increase in public spending on socio-economic and physical structures is important and encourages economic growth. However, Classical economists on the other hand argue that the increase in public expenditure may shift resources from the productive private sector to public sector which they believe is unproductive and hence, crowd out overall performance of the economy. These views indicate that policymakers worldwide including Malawi are under debate whether increase in public spending helps or hinders economic growth. Applying ADF and KPSS tests, Johansen-Juselius co-integration multivariate procedure and TYDL Granger causality test, this study investigates the relationship between government expenditure on roads infrastructure and GDP in Malawi using time series data spanning from 1978 to 2010. ADF and KPSS tests indicate that the series under investigation are integrated of order one (i.e. I(1)). The results of the Johansen co-integration tests indicate a long-run relationship between the roads expenditure and economic growth. The TYDL test indicates the existence of unidirectional causality running from roads expenditure and economic growth which supports Keynes hypothesis that government spending affects economic growth. The study, therefore, concludes that government spending on roads infrastructure causes economic growth, which confirms the main goal of MGDS that aims at achieving economic growth through infrastructure development. Based on these results, the study recommends that government should ensure that both capital and recurrent expenditure are properly managed to accelerate economic growth. More so, Government should promote efficient resource allocation on human capital development by encouraging more private participation to ensure productivity for intensive economic growth. en_ZA
dc.language.iso eng en_ZA
dc.subject.other Development Finance en_ZA
dc.title The impact of public spending on roads infrastructure on Malawi's economic growth en_ZA
dc.type Thesis / Dissertation en_ZA
uct.type.publication Research en_ZA
uct.type.resource Thesis en_ZA
dc.publisher.institution University of Cape Town
dc.publisher.faculty Faculty of Commerce en_ZA
dc.publisher.department Research of GSB en_ZA
dc.type.qualificationlevel Masters en_ZA
dc.type.qualificationname MCom en_ZA
uct.type.filetype Text
uct.type.filetype Image


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