An Empirical Analysis of the Determinants of Private Investment in Zimbabwe

Dynamic Research Journals' Journal of Economics & Finance (DRJ-JEF), Vol. 2(4), pp. 38-54, April 2017

17 Pages Posted: 1 May 2017

Date Written: April 29, 2017

Abstract

The worst of the ailments distressing the economy of Zimbabwe continue to be sycophantically dubious and characteristically dystopian policies that are still causing malicious effects on private investment and yet private investment is an indisputably powerful means for sustainable economic growth and development. Private investment in Zimbabwe has been significantly low for the past three decades and yet the performance of the economy of Zimbabwe, just like any other economy, relies upon investment; specifically, private investment. This has apparently stimulated much concern, especially to economists; considering the fact that private investment is the backbone of every economy, of which Zimbabwe is not an exception. Motivated by the concern on the persistent retrogressive contribution of private investment to GDP as well as the incessant underwhelming economic growth in Zimbabwe, this study systematically reviews the determinants of private investment in Zimbabwe. Results show that GDP and public investment are the most powerful factors that affect private investment in Zimbabwe. The study recommends attention to be made to all identified factors (that is, GDP, public investment, interest rate, private sector credit and political uncertainty), paying particular attention to the main determinants of private investment, that is GDP and public investment.

Keywords: Economic Growth, Gross Domestic Product (GDP), Investment, Private Investment, Public Investment, Zimbabwe

JEL Classification: B22, D92, E22, E60, E66, G11, H54, O16, O40, O49, P33, R42, R53

Suggested Citation

Bonga, Wellington Garikai and Nyoni, Thabani, An Empirical Analysis of the Determinants of Private Investment in Zimbabwe (April 29, 2017). Dynamic Research Journals' Journal of Economics & Finance (DRJ-JEF), Vol. 2(4), pp. 38-54, April 2017. Available at SSRN: https://ssrn.com/abstract=2960558

Wellington Garikai Bonga

Great Zimbabwe University ( email )

P. O. Box 1235
Masvingo
Masvingo, Masvingo 00263
Zimbabwe

Thabani Nyoni (Contact Author)

University of Zimbabwe ( email )

Mashonaland
Zimbabwe

HOME PAGE: http://www.uz.ac.zw

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