Dr Is Cameroon Worse Off Or Better Off With Foreign Aid On Its Economic Growth In The 21st Century?
KESUH JUDE THADDEUS
UNIVERSITY OF NIGERIA
Sunday Okwuchukwu Okafor
teesside university middlebrough England . united kindom
NJIMUKALA MOSES NEBONG
The University of Bamenda-Bameroon
Keywords: Economic growth, foreign aid, Government Expenditure, gross capital investment human capital development, foreign direct investment
Abstract
Abstract
Although foreign aid has promoted economic growth in some countries in many others, it has failed. This paper analyzes if Cameroon is worse off or better off with foreign aid on its economic growth in the 21st century in the long run and short using yearly time series data from 1970 to 2021 obtains from the World Bank development indicator. The dependent variable was economic growth measured by GDP per capita while the independent variable was foreign aid control with government expenditure, Human capital development, foreign direct investment and gross capital formation. The ARDL approach to cointegration (bounds test) was employed to analyze the relationships between foreign aid and economic. The results suggested in all scenarios that foreign aid has greatly worsened Cameroon economic growth in the 21st century by indicating a negative and insignificant long run effect on the GDP. Government expenditure also showed a negative and insignificant long run effect on the GDP. However, domestic investment emerged with a positive sign all round supporting the view that, investment appears to be a strong booster of Cameroon’s economic growth. HCD and FDI had a positive long run insignificant relationship on Cameroon economic growth. The paper recommends that the capabilities of the citizens of Cameroon needs to be created so that they become creators of wealth and creators of enterprise; so that they can live from their own activities. Again, foreign aid should be geared towards capital formation and skills development of labour through education and training.
Key words: Economic growth, foreign aid, Government Expenditure; gross capital investment human capital development, foreign direct investment.