Journal of Graduate Studies - VOL - 41-1

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Author: search.filters.author.Badr eldeen Abdalmalik Alhaj AbouzeedStart date: 2018

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    An Empirical Analysis of the relationship between Economic Growth and Some Macroeconomic Factors in Sudan: (1980-2014)
    (جامعة النيلين - مجلة الدراسات العليا, 2018-04-15) Badr eldeen Abdalmalik Alhaj Abouzeed; Ghadda Mohamed Awad Yousif; Elsheikh Mohammed Elkhidir Mohammed; Safiat Ali Saber Ali
    The objective of the study is to examine the empirical evidence of the existence of long – run and short-run relationship between economic growth, exports, investment and inflation in Sudan. Five control variables are included in the analysis, namely, exchange rate, government spending, foreign direct investment, money supply, and cost of finance. Three Stage Least Squares method (3SLS) has been employed to annual time series data covering the period (1980-2014), which are collected from the Central Bank of Sudan and Central Bureau of Statistics, using E-Views package Varian 10. The empirical results of simultaneous equations model indicate that change in real GDP is positively related to investment and exports. The relationship between investment and real output in term of elasticity remains very weak i.e. a one percent increase in investment leads to a respective real GDP increase of 0.11% only. Inflation has negative and statistically significant effect on real GDP. A 1% rise in inflation leads to a reduction in GDP over time by 0.09 percent. Also the results show that real output does not affect only by exports, investment and inflation, but depend upon other determinants (exchange rate, foreign direct investment, government spending, money supply and cost of finance). The study recommended that to increase the real GDP, policy makers will look after the investment, it is an important indicator for economic development. The government should adopt policies to widening and diversifying exports. In addition to that, the government should create a stable political and economic climate conducive to investment, and realize full employment of resources.