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Title: DOES GOVERNMENT EXPENDITURE INFLUENCE ECONOMIC GROWTH IN EAST AFRICA COMMUNITY?
Authors: AMERY SIMIYU MUREKA
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AMERY SIMIYU MUREKA Kibabii University, Kenya
MLA 8 MUREKA, AMERY SIMIYU. "DOES GOVERNMENT EXPENDITURE INFLUENCE ECONOMIC GROWTH IN EAST AFRICA COMMUNITY?" Int. j. of Social Science and Economic Research, vol. 7, no. 5, May 2022, pp. 1180-1191, doi.org/10.46609/IJSSER.2022.v07i05.003. Accessed May 2022. APA 6 MUREKA, A. (2022, May). DOES GOVERNMENT EXPENDITURE INFLUENCE ECONOMIC GROWTH IN EAST AFRICA COMMUNITY? Int. j. of Social Science and Economic Research, 7(5), 1180-1191. Retrieved from doi.org/10.46609/IJSSER.2022.v07i05.003 Chicago MUREKA, AMERY SIMIYU. "DOES GOVERNMENT EXPENDITURE INFLUENCE ECONOMIC GROWTH IN EAST AFRICA COMMUNITY?" Int. j. of Social Science and Economic Research 7, no. 5 (May 2022), 1180-1191. Accessed May, 2022. doi.org/10.46609/IJSSER.2022.v07i05.003.
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ABSTRACT: Economic growth of East Africa Community (EAC) region has remained low over the years for the region to attain the middle level economic status. High government expenditures in the region has increased demand for public debt since these expenditures are more than the tax generated revenues. This generated interest to study the influence of these factors on the economy. The study targeted the five countries of East Africa Community which consists of Kenya, Uganda, Tanzania, Rwanda and Burundi from 2005 to 2020. The study used panel data obtained from World Bank development indicators database. Stationary tests were carried to stabilize the data. Public debt and tax were stationary at level while economic growth and government expenditure were stationary at first difference. All variables were regressed at first difference for uniformity. Hausman test and Langrage Multiplier (LM) tests showed that pooled OLS regression model was the most appropriate to estimate the parameters and conduct the inference. Diagnostic tests results showed that the data had no problem of multicollinearity, heteroskedasticity and serial correlation.The study results showed in East Africa Community, government expenditure had a positive but insignificant effect on growth with a p-value of 0.273 at 0.05 significance level. The study recommends that the countries of EAC region should adopt robust fiscal policies that reduce public debts and taxation rates in their economies.

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