Working Paper Series: Special Edition of 2016 to 2018 Interns

countries would realistically be able to meet their target by 2030 if an intense natural disaster was to occur in 2018.

4.4 A Priori Expectations Prior to any econometric evaluation of the correlation between economic growth and the dependent variables, the following are a prior expectations based on economic theory and conclusion of some empirical studies as discussed in the literature review section above. Table 2: A Priori Expectations Variable Expected Sign GC - POP +/- FDI + USGDP + ND1 - ND2 - Despite differing views in the economic literature, Government consumption (GC) is generally expected to have a negative relationship with economic growth as a high level of government consumption increases the fiscal deficit, which negatively affects economic growth. Furthermore, a high level of government consumption may crowd out private investments thus slowing economic activity and thereby economic growth. The a priori expectation of the population growth (POP) variable is unclear as the variable may result in a positive sign given that population growth may lead to an increase in the productive capacity of the country, as there is now a larger quantity of human capital, thus spurring growth. On the other hand, there may be a negative relationship if the increase in the population does not positively contribute to growth. In addition, population growth may worsen resource scarcity and hinder growth.

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