Determinants of private investment in Ethiopia

This book was performed for studying the determinants of private investment in Ethiopia by using time-series data covering from 1983-2013 of 31 years. On this study, there is co-integration problem tested by Johansen co-integration test. Unit-root test was taken by Augumented ¿ Duckey Fuller test. Even though, some studies were done on private investment, still share of private investment to country¿s economy remained very low. Studying the main determinants and finding their response on long run and short run relation were critically performed as the main aim of this study. The book runs OLS estimation technique with Vector Error Correction Model (VECM). From the variables which was taken by this study to determine private investment in Ethiopia; Government investment, GDP per capita, inflation rate, broad money supply and credit given to the private sector were significant determinants of private investment in the long-run. Inflation rate affects private investment negatively in the long-run. In the short run, inflation and broad money supply were able to determine the short run model.