CW-School of Economics

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Browsing CW-School of Economics by Author "Kosimbei, G. K."

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    Agriculture production subsidies in developed countries: which way out for developing countries?
    (2003-09) Gachanja, Paul M.; Kosimbei, G. K.
    D eveloping countries participation in the world economy has declined alarmingly over the past 50 years in terms of GDp, exports and foreign investment. The Uruguay Round agreement on Agriculture (URAA) 2 brought world agricultural production and trade under a rules-based regime that not only governs market access, but also domestic support and export subsidies in the form of subsidies in the agricultural sector. In the developing countries, where agriculture is even more important, the biggest concern is with the effects on world markets of subsidized production and exports in DEeD countries. Agriculture is the backbone of the economies of many African countries. Agricultural exports account for a large share in total exports from these countries. Developed countries are known for giving agricultural production subsidies to farmers. These subsidies always depress world market prices rendering products from Africa and other developing countries uncompetitive. The general objective of this paper is to examine the effects of agriculture production subsidies in developed countries on agricultural performance in developing countries. The paper reveals that agriculture production subsidies hamper agriculture production in developing countries. The paper reveals that the subsidies should be reduced and agriculture production be left for the developing countries in the global economy.
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    Financial markets disparities in developed and developing countries
    (2003-09) Kosimbei, G. K.
    Financial markets are important in the process of economic growth and development in their role in savings mobilization. Despite the limited range of financial assets available to savers in developing nations, monetarization ratios are generally lower for such countries than for developed countries. The menu of assets available to private savers in developing countries from the formal financial system is often limited to cash, demand deposits, time deposits and sometimes government securities. Thepaper utilizes granger causality, unit root tests and Ordinary Least squaresregression to estimate the relevance of monetarization of the economy. Evidence from statistical data shows that causality exists from growth of GDP to monetarization of the economy, which was the main objective of this study. The unit root test reveals that growth of GDP is stationary at levels whereas Monetarization ratios are stationary atfirst difference. Theresults are consistent with economic theory. The major recommendation is that the government should reduce the restrictions on banks, especially the reserve ratio. This will allow banks to create more credit, and with competition lending rates will reduce, hence increased investments.