The effect of health on foreign direct investments inflows in Kenya
Abstract
FDI is one of the development indicators in developing countries. Many of these countries
(Kenya included) seek ways to improve on the foreign direct inflows. They do this by
identifying the factors that influence FDI and controlling or improving on these factors so as
to attract foreign investors. Some of the determining factors of FDI in Kenya have been
identified to be; infrastructure, insecurity, openness of the economy to trade, legal
framework and governance.
This study has examined the effect of health on foreign direct investment inflows in Kenya
for the period 1970 - 2003. Life expectancy and morbidity rates are used as proxies for
health. The results indicate that both life expectancy and morbidity rates influence FDI
inflows into the country significantly, although morbidity has a greater impact on FDI than
life expectancy. Other explanatory variables included in the model, apart from GDP per
capita have also been found to significantly affect FDI. Infrastructure, openness of the
economy to trade and education positively impact on FDI. While insecurity and GDP per
capita influences FDI negatively.
The study has also made several policy recommendations including seeking ways to increase
public investments on health, developing infrastructure, building more schools and
institutions of higher learning so as to cater for the increasing number of students and lastly
improving security in the country.
Citation
Masters thesis University of Nairobi (2005)Publisher
University of Nairobi Department of Economics
Description
Masters of Arts degree in Economics.