Browsing by Author "Etyang, Martin N."

Now showing 1 - 7 of 7
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    Determinants of investment demand in the informal sector: A case study of shoe making in Kibera, Nairobi
    (2012-04-05) Oketch, T. C.; Etyang, Martin N.; Oloo, K. O.
    The informal sector has an important role to play towards the industrialization process and generation of employment opportunities. The sector provides to potential employees for both the informal and formal sectors, thereby helping to improve the quality of life to those who would otherwise be without any source of livelihood. Also, the informal sector has a capacity to mobilize investments and produce affordable goods and services to the ever-increasing population. For these reasons, various stakeholders are targeting the sector so as to enhance the potential benefits. Despite these efforts, the sector has not become the expected solutions to Kenya's developmental problems. The concern of this study was to investigate the determinants of investment in the informal shoe-making sub-sector in Kibera area of Nairobi Province. Data was collected from a sample of 40 shoemakers in the area. Both linear and log-linear multiple regression models were specified and estimated and the results interpreted based on the log-linear model, which was adopted as the suitable one for analysis because it had more significant variables, and higher R2 and F-statistics. The results suggest that output of the firm; price of investment goods, entrepreneurs' dependants and of investment in the sub-sector. Contrary to a prior expectations, the coefficients of transfer payments, training, accessibility of the enterprise was negative. Further, the study found that none of the respondents had benefited from the assistance package provided by the government, donors, and other stakeholders. Thus, these shows that the promotion services aimed at the sector do not reach the entrepreneurs in the sub-sector. This paves way for various policy recommendations.
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    An econometric analysis of energy utilization in the Kenyan manufacturing sector
    (2012-06-11) Onuonga, S.M.; Etyang, Martin N.; Mwabu, Germano
    The overall purpose of this study was to analyze the factors that influence energy utilization in Kenya's manufacturing sector and to determine the extent of substitution possibilities between energy inputs and other non-energy factors of production within the Kenyan manufacturing sector over the 1970- 2005 period.The Kenya manufacturing sector is a major consumer of commercial energy in Kenya. It is the second largest user of petroleum products and the largest user of electricity. There is hardly any evidence that shows that the sector uses biofuels. The analysis of price and non-price variables that affect the use of energy within this sector is necessary for designing policy measures that can lead to energy conservation. Information on the degree of energy substitution is important in predicting the effects of energy shortages on manufactured output and industrial employment. This study used the translog model to analyze total factor demands and inter-fuel substitutions. Estimation was done in two stages. First, the sub-energy model was estimated and an aggregate energy index computed. In the second stage, the total factor cost shares were analyzed using the estimated energy price index as an instrumental variable. Estimation in all stages was done by the use of Maximum Likelihood Method. In divergence from the previous studies in Kenya, time series properties of the data were fully investigated before model estimation was done. The study found that, price of energy, cross price, output, technology, price of capital and unexpected events (droughts, U.S.A's attack on Iraq in 2003, and multiparty elections) influenced the sector's use of energy. The results for interfuel model indicated that demand for electricity and oil in the Kenyan manufacturing sector were price inelastic and that oil and electricity are substitutes. The fuel price and the cross price elasticities were found to be small but statistically significant. These results imply that manipulation of the fuel prices alone cannot achieve much in controlling the use of energy in the Kenyan manufacturing sector. Limited substitution possibilities between electricity and oil in this sector were found. Small substitution possibilities between energy and non-energy inputs were also detected. The results for the total factor cost shares showed that demand for energy and labour were price inelastic while that one of capital had a unitary elasticity. The results further showed that energy, labour and capital were substitutes, but the degrees of substitution among the factors were found to be very low, ranging from 0.07 to 0.75. This suggested that costs of production within the sector might rise significantly as a result of the price increase of the inputs, especially of energy
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    Field time constraints for farm planning models
    (Elsevier Masson, 1998) Etyang, Martin N.; Preckel, P.V.; Binkley, J.K.; Doster, D.H.
    Resource limits for weather dependent constraints in farm planning models are often implemented as chance constraints. Procedures for setting right-hand sides for these constraints are often based on rules of thumb which are seldom updated. This paper presents an approach for validating these rules of thumb, and demonstrates the approach for a heavily used farm planning model. An evaluation of the robustness of chance constraints for equipment availability which are dependent on good (sufficiently dry) field time, is presented. Rules for setting constraints affected by good field time were found to be dependent on the tillage system(s) under consideration. These results imply a need for more research on setting availabilities of stochastic resources under alternative tillage systems.
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    Monetary Policy And Private Sector Credit In Kenya
    (IOSR Journals, 2024-01) Maza, Edwin M.; Etyang, Martin N.
    The Kenyan banking sector has made significant strides in boosting lending to the private sector, which contributed around 31 percent of Gross Domestic Product as of 2021, up from 19 percent in the 1990s. In the past decade, Kenya has enacted several monetary driven policy tools to lower the cost of private sector advances, including the interest rate ceilings that were implemented in September 2016. The relatively high cost of lending by financial corporations to individuals and businesses has been identified as one of the main obstacles to credit expansion in Kenya. To understand how private sector credit responds to monetary policy changes, this study's main goal was to research the influence of policy strategy on private sector lending. Specifically, the study purposed to explore the outcome of changes in the money supply and lending rates on private sector advances. The study is of significance as it examined the connection between Kenya's monetary policy and private sector lending with a view to understand how private enterprise lending responded to changes in money supply and interest rates. The analysis used secondary data, quarterly macroeconomic statistics 2010-2021 from the Central Bank of Kenya and Kenya National Bureau of Statistics and applied a vector error correction model. A unit root test was performed to check for stability, and a Johansen cointegration assessment was performed to establish presence of short- or long-run relationship among the variables affecting private sector lending. The findings of this study ascertained that there exists a long-term relationship between monetary policy and private sector credit in Kenya. To determine how changes in interest rates affect growth of private sector, the research findings show that interest rates and private sector credit are inversely related in the long-term. In addition, the results show that the growth of money supply affects growth of private sector credit that the growth of money supply has a positive impact on the growth of credit to the private sector as per the long-run estimation. This outcome, therefore, shows that, a reduction in the money supply causes a decrease in private sector credit, and vice versa. The study has demonstrated that monetary policy and the expansion of private sector loans are closely related over time. It is, therefore, unfeasible to underestimate the central bank's influence over the economy's long run liquidity management through interest rates and money supply by extension, which impacts several macroeconomic indicators. By implementing accommodative monetary policies that directly affect cost of credit to individuals and firms and, additionally, encourage investment through borrowing by fostering confidence in the nation's financial sector of the economy, the Central Bank of Kenya plays a crucial role in creating the most favorable conditions to foster credit advances to the private sector.
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    Stock Market Liberalization, Stock Market Performance and Economic Growth in Kenya
    (2014-03-07) Kinuthia, Isaac Kimunio; Etyang, Martin N.
    The study empirically examined whether stock market liberalization, by improving the functioning of domestic stock market accelerates economic growth in Kenya. The study also evaluated the nature of the relationship between stock market performance and economic growth in Kenya. The stock market liberalization and performance were measured using two variables namely stock market size as measured by stock market capitalization and stock market turnover respectively. The study used quarterly time series data collected through secondary sources and covered a period .of 22 years from January, 1991 to December, 2012. The study utilized econometric techniques of Vector Autoregressive (VAR) and Granger Causality Tests to explore the relationships. The empirical results showed a uni-directional causal link that runs from stock market development to economic growth and there is evidence of an indirect transmission mechanism through the effect of stock market development on investment. The study found that stock market liberalization has a significant positive impact on the economic growth in Kenya. There is a strong case for policy recommendation to further develop the stock market as a driver of economic performance in Kenya.
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    Stock Market Liberalization, Stock Market Performance and Economic Growth in Kenya
    (Canadian Center of Science and Education, 2014) Kinuthia, Isaac Kimunio; Etyang, Martin N.
    The study empirically examined whether stock market liberalization improves the functioning of domestic stock market and accelerates economic growth in Kenya. The study also assessed the kind of relationship between liberalization, stock market performance and economic growth in Kenya. Liberalization was assessed by stock market capitalization while turnover was used to asses stock market performance. The study used quarterly time series data collected through secondary sources and covered a period of 22 years from January, 1991 to December, 2012. The study utilized econometric techniques of Vector autoregressive and Granger Causality Tests to investigate the relationships. The results displayed a one way causality that runs from stock market development to economic growth. The results also show that stock market liberalization indirectly impacts on economic growth through investment. The study found that stock market liberalization has a significant positive impact on the economic growth in Kenya
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    Supply Response of Kenyan Coffee in the World Market
    (2014-03-10) Njaramba, Stephen Githae; Kosimbei, G. K.; Etyang, Martin N.
    The drastic drop in Kenya coffee supply in the last twenty years has severely affected the country's export revenues as well as the livelihoods of two million small scale producers and over six million people who directly or indirectly depend on coffee. In spite of the central role which coffee has played in the county's development, Coffee production has shown a steady decline over the last two decades. Coffee production declined from an all time high of about 130,000 metric tons in 1987/88 to a low of about 42,000 metric tons in the 2010 coffee calendar year In this study the objective was to estimate the response of Kenyan coffee which is supplied at the world market. Coffee is an important crop to Kenya since it is a source of foreign exchange. It is also the main agricultural enterprise in some of the districts in the country and the major source of income to these districts. Therefore the research project sought to come up with the supply function of Kenyan coffee to the international market. Coffee supply in Kenya has continued to decline despite policy reforms in the coffee sector. The principal of cointegration and Error Correction Model were used to establish the effect of various variables to the supply of coffee to the international market. Despite the popular belief that falling international prices paid for coffee is the course of decline of supply from Kenya.,this study found out that the international prices did not have significant effect on the supply of coffee from Kenya to the international market. Rather the supply is affected by cost of inputs both in the short and long run, the cost of moving coffee from the farm to the market, weather and the policies employed by the government. All the other variables were found to be insignificant at 5 percent level.