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Macroeconomic Implications of Demographic Changes in Kenya

G.N. Kirori and J. Ali

Working Papers from African Economic Research Consortium

Abstract: The research study attempts to quantify probable macroenconomic effects of demographic changes in Kenya given the available evidence that Kenya is going through a demographic transition. First, the study establishes linkages between demographic variables and sectoral government expenditures through the OLS estimation method. Next, the estimated equations are used to project three expenditures profiles based on three population scenarios generated from different assumptions on changes in fertility. Finally, the projected expenditures are used in a macroeconomic model of the Kenyan economy to simulate their effects on five key macroeconomic variables: inflation, rate of growth of output, balance of payments, budget deficit and rate of growth of investment.

Keywords: DEMOGRAPHY; MACROECONOMICS; ECONOMETRIC MODELS; PREVISIONS (search for similar items in EconPapers)
JEL-codes: J10 J18 E17 C22 (search for similar items in EconPapers)
Date: 1998
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