IJSSER

Title: The Nexus Between Foreign and Portfolio Investments, and Youth Unemployment in Kenya
Authors: JOSPHAT MUTUKU KIOKO and DR. ISAAC KIMUNIO
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JOSPHAT MUTUKU KIOKO1 SUPERVISOR- DR. ISAAC KIMUNIO2 1.B.A Economics with Sociology, Kenyatta University 2. Department of Applied Economics, School of Business, Economics and Tourism, Kenyatta University
MLA 8 KIOKO, JOSPHAT MUTUKU, and DR. ISAAC KIMUNIO. "The Nexus Between Foreign and Portfolio Investments, and Youth Unemployment in Kenya." Int. j. of Social Science and Economic Research, vol. 9, no. 10, Oct. 2024, pp. 4647-4687, doi.org/10.46609/IJSSER.2024.v09i10.039. Accessed Oct. 2024. APA 6 KIOKO, J., & KIMUNIO, D. (2024, October). The Nexus Between Foreign and Portfolio Investments, and Youth Unemployment in Kenya. Int. j. of Social Science and Economic Research, 9(10), 4647-4687. Retrieved from https://doi.org/10.46609/IJSSER.2024.v09i10.039 Chicago KIOKO, JOSPHAT MUTUKU, and DR. ISAAC KIMUNIO. "The Nexus Between Foreign and Portfolio Investments, and Youth Unemployment in Kenya." Int. j. of Social Science and Economic Research 9, no. 10 (October 2024), 4647-4687. Accessed October, 2024. https://doi.org/10.46609/IJSSER.2024.v09i10.039.
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ABSTRACT: Youth unemployment is a global problem as countries at different stages of development that is underdeveloped, developing and developed are grappling with the problem of youth unemployment, which has been addressed in different country specific ways. Investments of whatever form are the life wire of the economy. Investments are a remedy for macroeconomic problems of unemployment, income inequality and economic growth. Investments change the economic structure to affect certain economic sectors eyed by private and public sectors. Investments from foreign entities provide a supportive role in an open foreign economic system with accompanying effects on economic development and growth. Foreign direct investments effects are seen unevenly or uniformly around the globe due to variety economic conditions. Investments in whatever form in a certain country is a key ingredient of economic growth or a catalyst of growth and development leading to job creation for the youth and other people in the labor force. Facilitated portfolio investments and capital market ease of penetration are pull factors for investors. The study seeks to determine the investments effects on Kenya’s youth unemployment rate. The study objectives are to determine the foreign direct investments and portfolio investments effects on Kenya’s youth unemployment rate. Investments have not been much prioritized to affect the level of youth unemployment; this informs this research work. The Keynesian theory of unemployment anchors the study. This research would be non-experimental as the time series data would be collected from Kenya National Bureau of Statistics, World Bank Development Indicators and Central Bank of Kenya for 1993 to 2022 period. Time series properties of trend and stationarity that is unit roots tests were tested for all the variables if it exists before estimation. Linear regression assumptions of homoscedasticity, linearity and collinearity were tested before estimation. Multiple regression analysis method was used to analyze stationary data. Tables were used to present results. Study findings, on the effect of foreign direct investments had a statistical insignificant effect on youth unemployment ages 15- 24 years in Kenya while portfolio investments had a statistical insignificant effect on youth unemployment rate ages 15-24 years in Kenya. Conclusion of the study, portfolio investments and foreign direct investments t-statistics were insignificant at five per cent (5%) level of significance therefore could not affect the level of youth unemployment rate ages 15-24 years. Recommendations of the study portfolio investments, foreign direct investments and other forms of investments should be directed towards labor absorbing sectors so that different categories of unemployment can be absorbed thus employment creation. Kenya’s macro-economic measures need to be directed towards all categories of unemployment.

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