IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this article or follow this journal

How Would Population Growth Affect Investment in the Future? Asymmetric Panel Causality Evidence for Africa

  • Simplice Asongu

    ()

Our generation is experiencing the greatest demographic transition and Africa is at the center of it. There is mounting concern over corresponding rising unemployment and depleting per capita income. We examine the issues in this paper from a long-run perspective by assessing the relationships among population growth and a plethora of investment dynamics: public, private, foreign and domestic investments. Using asymmetric panels from 38 countries with data spanning from 1977 to 2007, our findings reveal a long-run positive causal linkage from population growth to only public investment. But for domestic investment, permanent fluctuations in human capital affect permanent changes in other forms of investments. Robustness checks on corresponding short-run Granger causality analysis and the long-run ‘physical capital led investment’ nexus are consistent with the predictions of economic theory. As a policy implication, population growth may strangle only public finances in the long-run. Hence, the need for measures that encourage family planning and create a conducive investment climate (and ease of doing business) for private and foreign investments. Seemingly, structural adjustments policies implemented by sampled countries may not have the desired investment effects in the distant future.

(This abstract was borrowed from another version of this item.)

To our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.

Article provided by African Development Bank in its journal African Development Review.

Volume (Year): 25 (2013)
Issue (Month): 1 ()
Pages: 14-29

as
in new window

Handle: RePEc:adb:adbadr:480
Contact details of provider: Postal: 15 Avenue du Ghana P.O.Box 323-1002 Tunis-Belvedère, Tunisia
Phone: (+216) 71 10 39 00
Fax: (225) 21.77.53
Web page: http://www.afdb.org/en/knowledge/publications/
Email:


More information through EDIRC

Order Information: Web: http://ordering.onlinelibrary.wiley.com/subs.asp?ref=1467-8268&doi=10.1111/%28ISSN%291467-8268

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Asongu Simplice, 2012. "The political economy of development assistance: peril to government quality dynamics in Africa," Working Papers 12/008, African Governance and Development Institute..
  2. Maddala, G S & Wu, Shaowen, 1999. " A Comparative Study of Unit Root Tests with Panel Data and a New Simple Test," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 61(0), pages 631-52, Special I.
  3. Tony Johnston, 1992. "Population, Education and Sustainable Development," African Development Review, African Development Bank, vol. 4(1), pages 201-235.
  4. Simplice A, Asongu, 2012. "Determinants of Health Professionals’ Migration in Africa," MPRA Paper 37632, University Library of Munich, Germany.
  5. Meghnad Desai, 1992. "Population and Poverty in Africa," African Development Review, African Development Bank, vol. 4(1), pages 63-78.
  6. Reginaldo Pinto Nogueira, 2009. "Is monetary policy really neutral in the long-run? Evidence for some emerging and developed economies," Economics Bulletin, AccessEcon, vol. 29(3), pages 2432-2437.
  7. Pasaran, M.H. & Im, K.S. & Shin, Y., 1995. "Testing for Unit Roots in Heterogeneous Panels," Cambridge Working Papers in Economics 9526, Faculty of Economics, University of Cambridge.
  8. Aude POMMERET & William T. SMITH, 2004. "Fertility, Volatility, and Growth," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) 04.08, Université de Lausanne, Faculté des HEC, DEEP.
  9. Asongu Simplice, 2011. "Government Quality Determinants of Stock Market Performance in African Countries," Working Papers 11/019, African Governance and Development Institute..
  10. K.E. Vaidyanathan, 1992. "Population Trends, Issues and Implications," African Development Review, African Development Bank, vol. 4(1), pages 1-32.
  11. Patrick Ohadike, 1992. "Population, Policy Development and Implementation in Sub‐Saharan Africa," African Development Review, African Development Bank, vol. 4(1), pages 273-297.
  12. Peter Pedroni, 1999. "Critical Values for Cointegration Tests in Heterogeneous Panels with Multiple Regressors," Department of Economics Working Papers 2000-02, Department of Economics, Williams College.
  13. P.T. Seya, 1989. "The Population Challenge in Africa and the Prospects for the African Development Bank's Intervention," African Development Review, African Development Bank, vol. 1(2), pages 30-51.
  14. Azomahou, Théophile & Mishra, Tapas, 2008. "Age dynamics and economic growth: Revisiting the nexus in a nonparametric setting," Economics Letters, Elsevier, vol. 99(1), pages 67-71, April.
  15. Thomas Gries & Manfred Kraft & Daniel Meierrieks, 2008. "Linkages between Financial Deepening,Trade Openness and Economic Development: Causality Evidence from Sub-Saharan Africa," Working Papers CIE 15, University of Paderborn, CIE Center for International Economics.
  16. Simplice A, Asongu, 2012. "Fighting consumer price inflation in Africa. What do dynamics in money, credit, efficiency and size tell us?," MPRA Paper 41553, University Library of Munich, Germany.
  17. Peter Pedroni, 2001. "Purchasing Power Parity Tests In Cointegrated Panels," The Review of Economics and Statistics, MIT Press, vol. 83(4), pages 727-731, November.
  18. Rosenzweig, Mark R, 1990. "Population Growth and Human Capital Investments: Theory and Evidence," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages S38-70, October.
  19. Etienne De Walk & Dominique Meekers, 1992. "The Socio‐Cultural Context of Family and Fertility in Sub‐Saharan Africa," African Development Review, African Development Bank, vol. 4(1), pages 33-62.
  20. Stein Hansen, 1992. "Population and The Environment," African Development Review, African Development Bank, vol. 4(1), pages 118-164.
  21. Simplice A Asongu, 2012. "On the effect of foreign aid on corruption," Economics Bulletin, AccessEcon, vol. 32(3), pages 2174-2180.
  22. Hondroyiannis, George & Papapetrou, Evangelia, 2005. "Fertility and output in Europe: new evidence from panel cointegration analysis," Journal of Policy Modeling, Elsevier, vol. 27(2), pages 143-156, March.
  23. Camarero, Mariam & Tamarit, Cecilio, 2002. "A panel cointegration approach to the estimation of the peseta real exchange rate," Journal of Macroeconomics, Elsevier, vol. 24(3), pages 371-393, September.
  24. Kao, Chihwa, 1999. "Spurious regression and residual-based tests for cointegration in panel data," Journal of Econometrics, Elsevier, vol. 90(1), pages 1-44, May.
  25. Starr, Martha A., 2005. "Does money matter in the CIS? Effects of monetary policy on output and prices," Journal of Comparative Economics, Elsevier, vol. 33(3), pages 441-461, September.
  26. Levin, Andrew & Lin, Chien-Fu & James Chu, Chia-Shang, 2002. "Unit root tests in panel data: asymptotic and finite-sample properties," Journal of Econometrics, Elsevier, vol. 108(1), pages 1-24, May.
  27. Asongu Simplice, 2012. "Reversed Economics and Inhumanity of Development Assistance in Africa," Working Papers 12/034, African Governance and Development Institute..
  28. Hasan, Mohammad S., 2010. "The long-run relationship between population and per capita income growth in China," Journal of Policy Modeling, Elsevier, vol. 32(3), pages 355-372, May.
  29. Simplice Asongu, 2014. "The impact of health worker migration on development dynamics: evidence of wealth effects from Africa," The European Journal of Health Economics, Springer, vol. 15(2), pages 187-201, March.
  30. Uma Lele & Kofi Adu‐Nyako, 1991. "Integrated Strategy Approach for Poverty Alleviation: A Paramount Priority for Africa," African Development Review, African Development Bank, vol. 3(1), pages 1-29.
  31. Ivar Kolstad & Espen Villanger, 2008. "Foreign Direct Investment in the Caribbean," Development Policy Review, Overseas Development Institute, vol. 26(1), pages 79-89, 01.
  32. Peter Pedroni, 2000. "Fully Modified OLS for Heterogeneous Cointegrated Panels," Department of Economics Working Papers 2000-03, Department of Economics, Williams College.
  33. Venus Khim-Sen Liew, 2004. "Which Lag Length Selection Criteria Should We Employ?," Economics Bulletin, AccessEcon, vol. 3(33), pages 1-9.
  34. Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, vol. 55(2), pages 251-76, March.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:adb:adbadr:480. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (John Anyanwu)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.