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Effects of Investment on Macroeconomic Variables in the Sudanese Economy

Author

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  • Mohamed, Issam A.W.

Abstract

Most developing and underdeveloped countries beside Sudan suffer from the low levels of income in addition to the low savings that are result from the lack of sophisticated savings channels. Hence, the investment depends on the individual's abilities on self savings, where the investment is considered as major motivating vehicle for economic activity due to its direct correlation with the capital accumulation process that increases the productivity capacity for the national economy and creating job opportunities and achieving economic development. Subsequently, the importance of the investment comes from effective role that can be practiced on the national product. The present paper aims at explaining the impact of influential factors on the investment function in the Sudan and then formulating a measuring model for it. It is assumed that there is a causal relationship between investment and influential factors. The results of the empirical analysis show that there is a positive relationship between investment and Gross Domestic Products (GDP). However, there is a negative relationship between inflation rate and finance cost on investment. It is concluded that there is no significant effect from the inflation rate and finance cost while there is existence of other fixed variables on investment. The conclusions are that more data are required for further analyses with other variables with significant effect on investment such as: imports, national income and government expenditure to attain a model that can be used for investment anticipation in the coming years.

Suggested Citation

  • Mohamed, Issam A.W., 2010. "Effects of Investment on Macroeconomic Variables in the Sudanese Economy," MPRA Paper 32293, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:32293
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    File URL: https://mpra.ub.uni-muenchen.de/32293/1/MPRA_paper_32293.pdf
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    References listed on IDEAS

    as
    1. Marianne Ojo, 2011. "Co-operative and competitive enforced self regulation: The role of governments, private actors and banks in corporate responsibility," Journal of Financial Regulation and Compliance, Emerald Group Publishing, vol. 19(2), pages 139-155, May.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Sudan; Macroeconomic Variables; Investment; Development;

    JEL classification:

    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • N1 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • H5 - Public Economics - - National Government Expenditures and Related Policies
    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • E2 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment
    • C8 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs

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