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The Economy Wide Impact of Investment on Infrastructure for Electricity in Ethiopia: A Recursive Dynamic Computable General Equilibrium Approach

Year 2015, Volume: 5 Issue: 4, 986 - 997, 01.12.2015

Abstract

This study has applied a recursive dynamic CGE model to examine the economic impact of investment on infrastructure for electricity using an updated 2009/10 Social Accounting Matrix. Three simulations (foreign saving, domestic household and enterprises saving and mix of foreign and domestic saving to finance the investment) in combination with TFP of industrial and service sectors are used. The findings of the study have shown the improvement of the real GDP, output of industrial and service sectors in all simulations. Nonetheless, mixed effects have found on household consumption and trade balance. The highest growth of real GDP is registered when the investment on electricity is fully financed by domestic household and enterprise saving. However, household consumption expenditure has grown at negative rate worsening the welfare of households. Investment on electricity fully financed by foreign saving is resulted in lower growth rate of real GDP due to worsening of net export. In addition, it has benefits for households as it increases their welfare. But it is to be repaid in the future that would increase indebtedness of the country. So, financing the investment partly by domestic household saving and foreign saving would be worthwhile.

Year 2015, Volume: 5 Issue: 4, 986 - 997, 01.12.2015

Abstract

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Details

Other ID JA57VG55FF
Journal Section Research Article
Authors

Dinkneh Gebre Borojo This is me

Publication Date December 1, 2015
Published in Issue Year 2015 Volume: 5 Issue: 4

Cite

APA Borojo, D. G. (2015). The Economy Wide Impact of Investment on Infrastructure for Electricity in Ethiopia: A Recursive Dynamic Computable General Equilibrium Approach. International Journal of Energy Economics and Policy, 5(4), 986-997.
AMA Borojo DG. The Economy Wide Impact of Investment on Infrastructure for Electricity in Ethiopia: A Recursive Dynamic Computable General Equilibrium Approach. IJEEP. December 2015;5(4):986-997.
Chicago Borojo, Dinkneh Gebre. “The Economy Wide Impact of Investment on Infrastructure for Electricity in Ethiopia: A Recursive Dynamic Computable General Equilibrium Approach”. International Journal of Energy Economics and Policy 5, no. 4 (December 2015): 986-97.
EndNote Borojo DG (December 1, 2015) The Economy Wide Impact of Investment on Infrastructure for Electricity in Ethiopia: A Recursive Dynamic Computable General Equilibrium Approach. International Journal of Energy Economics and Policy 5 4 986–997.
IEEE D. G. Borojo, “The Economy Wide Impact of Investment on Infrastructure for Electricity in Ethiopia: A Recursive Dynamic Computable General Equilibrium Approach”, IJEEP, vol. 5, no. 4, pp. 986–997, 2015.
ISNAD Borojo, Dinkneh Gebre. “The Economy Wide Impact of Investment on Infrastructure for Electricity in Ethiopia: A Recursive Dynamic Computable General Equilibrium Approach”. International Journal of Energy Economics and Policy 5/4 (December 2015), 986-997.
JAMA Borojo DG. The Economy Wide Impact of Investment on Infrastructure for Electricity in Ethiopia: A Recursive Dynamic Computable General Equilibrium Approach. IJEEP. 2015;5:986–997.
MLA Borojo, Dinkneh Gebre. “The Economy Wide Impact of Investment on Infrastructure for Electricity in Ethiopia: A Recursive Dynamic Computable General Equilibrium Approach”. International Journal of Energy Economics and Policy, vol. 5, no. 4, 2015, pp. 986-97.
Vancouver Borojo DG. The Economy Wide Impact of Investment on Infrastructure for Electricity in Ethiopia: A Recursive Dynamic Computable General Equilibrium Approach. IJEEP. 2015;5(4):986-97.