Browsing by Subject "Economic Growth"

Now showing 1 - 4 of 4
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    Open Access
    Constraints to Small Firm and Medium’s Contribution to Economic Growth in Zambia
    (2019) Matakala, Bridget Sikopo; Mundia, Kabinga
    Small to medium scale enterprises (SMEs) arguably drive economic growth and job creation in developing countries, but factors that hinder their growth are generic or specific to sectors and remain a crucial area of research. This study examines factors constraining SMEs from optimally contributing to economic growth of Zambia. The study answered the following research questions; what factors act as constraints for SMEs to contribute towards economic growth; how conducive are the policy and institutional infrastructure for the SMEs to operate efficiently and to establish whether the evidence presented by these factors are specific to Zambia or apply elsewhere. For research design, the study adopted the mixed research approach. Both quantitative and qualitative research approaches were implored in order to produce the findings outlined in this report. Simple random sampling was used to draw a total of 250 SMEs to which structured questionnaires were administered. Semi-structured interviews were also conducted with three major stakeholders. The study used the statistical package of social science (SPSS) to analyse the quantitative data while qualitative data was analysed thematically- by identifying key themes and summarizing related information under each theme- for perspectives around SMEs contribution to economic growth. The study findings identify internal and external factors that constrain SMEs from contributing efficiently to economic growth and these include; 1) poor access to finance, 2) competition, 3) lack/inadequate infrastructure, and 4) lack of skills and training and these are similar across regions and other countries. On the other hand, it was stated that the high cost of production (as a result of high/multiple taxes and tariffs) prevent SMEs ability to effectively contribute to economic growth. The findings further show that institutionalised efforts created to ensure the SMEs flourish contribute effectively to economic growth. However, the correlation between targeting and segmentation of the SMEs for funding key areas of economic activities is not clear. Results show that the major factors according to the survey were the failure to access finance as attested by 160 of the 250 respondents who put this as the biggest impediment in success of their business and 65 of the respondents gave high taxes as the factor affecting them the most. The rest of the respondents gave competition and the absence of appropriate infrastructure to support business growth as a reason for poor performance and contribution to wider economic growth. Additionally, the findings show that there is no significant relationship between internal and external constraining factors and enterprise contribution to economic growth. To ensure greater SME contribution to economic growth, this study emphasises government interventions in financial services and infrastructure development, clarity in the implementation of policy and institutional provisions, encouragement of SME value-chain and market linkages as well as creation of knowledge hubs.
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    Open Access
    Determinants of economic growth In Sub-Saharan Africa: decomposition of exports and imports
    (2017) Oyebanjo, Olawale; Gossel, Sean J
    This dissertation examines the impact of export and import components on economic growth in 18 Sub-Saharan African countries over the period of 1995-2015. This study uses a neoclassic economic growth model containing GDP, export components, import components, export concentration index, capital and labour force as variables of analysis. The results of fixed effects estimations show that both exports and imports contribute significantly to economic growth. On a specific level, growth in raw material exports, and not manufactured exports, is significantly associated with GDP growth while growth in manufactured imports, and not raw material imports, is significantly associated with GDP growth. The export concentration index is found to have no significant relationship with GDP growth. In addition, the results find that capital formation has a more significant influence on economic growth than labour does.
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    Open Access
    The effect of financial development on economic growth: the case of South Africa
    (2022) Kawamya, Ackim; Nikolaidou, Eftychia
    This study examines the effect of financial development on economic growth in South Africa. South Africa is an interesting case study, as it provides a relatively rich environment in terms of data. While the finance and business sector has grown significantly in the last ten years becoming a major contributor to gross domestic product, the South African economy has been struggling to register positive output in the preceding years. The study utilizes an Autoregressive Distributed Lag approach to cointegration and a Solow model to consider the role of banks, financial institutions, and financial markets independently. The results reveal that financial institutions have a considerable role in fostering economic development in the long run in South Africa. Conversely, financial market indicators do not have long run effects on growth in South Africa and in the short run, financial markets negatively influence growth. High foreign participation in the financial markets including ease of capital flows and currency volatility could be reasons for this result.
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    The Impact of Financial Inclusion on the Nigerian Economy
    (2020) Arthur-Iweze, Ifeanyi Jane; Alhassan, Abdul Latif
    Financial inclusion remains a critical issue for developing economies such as Nigeria, where the focus of the government is to bring all economic units into the pool of the country's financial system. The rate of financial inclusion is an economic yardstick that cannot be discounted and one which remains a clear focal point of different inter-governmental efforts and policy. On one hand, there is the realisation that a low rate of financial inclusion means that a huge percentage of the population rarely has access to the kind of financial services that can take them out of poverty. As a contemporary discourse, this research seeks to assess the impact of financial inclusion on the development of the economy; arguing on the premise that proxy indicators in existing research have failed to provide a clear picture on the impact of financial inclusion on the economy, thereby failing to provide stakeholders with a strong motivation to pursue financial inclusiveness in the country. The focus of the study is to assess the effect of financial inclusion on income inequality and economic growth. To achieve this objective the study leverages on data spanning a period of 34 years (1981 to 2016), based on data generated from the Central Bank of Nigeria Statistical Bulletin and the World Bank Development Indicators. Using the Error Correction Mechanism (ECM),Unit Root Analysis and the Co-Integration analytical framework, the findings indicated that the short and longrun relationship between financial inclusion and economic growth in Nigeria show that the current values of the variables were not significant. Regarding the relationship between financial inclusion and income inequality in Nigeria, the short-run result revealed that only the past values of loans to rural areas and number of commercial bank branches appears to be significant, while at the long-run, the lagged value of gross domestic product per capital, commercial bank deposits and loans to rural areas were found to be statistically significant. The study further notes that financial inclusiveness was a precursor for economic growth in Nigeria. It is on this basis that the study recommends among others that; there is the need to increase loans to the rural areas by at least 50% this can be done through moral suasion to boost the economic activities in the rural areas, improve their aggregate demand, and ultimately their standard of living. There is also the need to engage more workforce in the rural areas to close the inequality gap prevalent in the country.