أثر الإستثمارات فى الطلب على عنصر العمل البشرى فى القطاع الزراعى المصرى

Effect of Investment on the Demand of Human Labor Input in the Egyptian Agricultural Sector

Fawzy A. El-Shazly, Soad Sayed Mahmoud, Yehia Mohamed Ahmed and Emad Shehata

MPRA Paper from University Library of Munich, Germany

Abstract: Investment is considered one of the most important tools for increasing Gross Domestic Product in Egypt. The agricultural sector is considered one of the pioneer sectors for realization of economic development in Egypt. On the other hand encouragement of the increase in investment rates, is considered one of the goals of the economic development in Egypt, where the realization of the development is not possible without the abundance of a suitable rate of investment that lead to more demand on labor. Egypt has faced several problems that hindered the economic development such as: the general state budget’s deficit, the increase of deficit in the balance of payments, the higher rate of inflation either by demand inflation or by production costs inflation, the higher rates of unemployment, and in addition to the existence of structural defects between the fiscal and monetary policies. The problem and objective of this study are concerned with the role of investment in increasing the demand on human labor input in the agricultural sector, in the shade of fiscal and monetary policies. The research applied simple regression and simultaneous equations models by three stages least squares (3SLS) during (1990-2007). The results indicated to the effectiveness of expanded fiscal policy to increase the demand on labor, either by increase government expenditure or decrease taxes that lead to increase production, consumption, labor, and further job opportunities. Also the implementation of an expanding monetary policy based on the reduction of the interest rate in order to encourage the investment that is necessary for pushing forward the economic development’s wheel. Recommendations are related to applying expanded monetary policy to encourage investment, especially in the intensive labor projects, and expanded fiscal policy by reducing taxes and increasing government expenditure to increase production, consumption, and employment.

Keywords: Investment; 3SLS (search for similar items in EconPapers)
JEL-codes: E2 (search for similar items in EconPapers)
Date: 2010-04, Revised 2010-04
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Published in Egyptian Statistical Society, The 35th International Conference for Statistics Computer Science and its applications 1.35(2010): pp. 42-69

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