Specification of Investment Functions in Sub-Saharan Africa

Bayraktar, Nihal ; Fofack, Hippolyte

World Bank, Washington, DC

关键词: ACCUMULATION RATE;    ADVERSE EFFECT;    AGGREGATE DEMAND;    AGGREGATE LEVEL;    AGRICULTURE;   

DOI  :  10.1596/1813-9450-4171
RP-ID  :  WPS4171

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

It is a well-known fact that one of themost important determinants of growth is private investment.But in the developing country context of widespread poverty,the effects of initial conditions on the process of capitalaccumulation have seldom been investigated. This paperhighlights heterogeneity in the process of capitalaccumulation across different countries in Sub-SaharanAfrica, and derives a formal specification of investmentfunctions in the primary, industry, and service sectors inthe region using a variation of the combined Tobin's QTheory and the neoclassical models of investment. Theresults highlight a more rapid accumulation of capital inthe relatively high income subpanel and a wideningpublic-private capital accumulation gap. A functionalspecification points to the significance of aggregateprofitability shocks, the financing cost of investment, andpublic capital stock in estimating the growth rate ofprivate capital accumulation. These results are supportedempirically, as highlighted by the relatively small absolutedeviation between actual and predicted value distributions.