KIJHUS Volume. 5, Issue 1 (2024)

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Muhereza T. Franklin, Kibuuka Muhammad, Mutenyo John, Wokadala James, Ssekajugo Derrick, Olanipekun Dayo B, & Abuga Isaac Mokono
 

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Determinants of economic growth among the East African community countries (1990-2020)

Abstract: This study examines the factors influencing economic growth within the member states of the East African Community (EAC), including Uganda, Tanzania, Rwanda, Kenya, and Burundi, for the period from 1990 to 2020. Utilizing panel time series data, the analysis commences with descriptive statistics to investigate the trends of essential variables. The stationarity of the data is evaluated using the Pesaran-Shin unit root test, followed by the application of both Fixed Effects and Random Effects Generalized Least Squares (GLS) regression models. The Breusch-Pagan Lagrangian multiplier test is conducted to ascertain the appropriate model specification. The empirical findings identify four critical determinants of economic growth: inflation, defense expenditure, population growth, and imports. Specifically, inflation and population growth are shown to have a positive impact on economic growth, whereas defense expenditure and imports are negatively correlated with growth. Policy recommendations for EAC governments include the enhancement of foreign direct investment (FDI) policies, the maintenance of moderate inflation levels, an increase in government consumption expenditure, the promotion of sustainable population growth, and the regulation of defense spending, internet usage, mobile phone subscriptions, and imports to improve economic performance.
 
 
 

KIU Interdisciplinary Journal of Humanities and Social Sciences, 2025 | All Articles