Public Policies and Private Savings and Investment in Sub-Saharan Africa: An Empirical Investigation

Author/Editor:

Dhaneshwar Ghura ; Michael T. Hadjimichael

Publication Date:

February 1, 1995

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

This paper assesses empirically the role of public policies in stimulating private savings and investment in sub-Saharan African countries, based on data for the period 1986-92. The main findings of the analysis are as follows: (i) policies effective in stimulating private savings and investment include those that keep the rate of inflation low, reduce macroeconomic uncertainty, promote financial deepening, and lower the external debt burden; (ii) measures that promote structural reforms and reduce the budget deficit (without lowering government investment) help to raise private investment; and (iii) declines in government savings are only partially offset by increases in private savings.

Series:

Working Paper No. 1995/019

Subject:

Foreign exchange Government debt management Income National accounts Private investment Private savings Public financial management (PFM) Real effective exchange rates

Notes:

Based on data for the period 1986-92.

English

Publication Date:

February 1, 1995

ISBN/ISSN:

9781451922523/1018-5941

Stock No:

WPIEA0191995

Pages:

48

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