Contents



Preface

Macroeconomic analysis is a potent tool for stimulating strong economic growth and sustainable development. It generates insights into understanding the intricacies of national and global economic trends and issues that arise from the policy choices of governments. The core principles of macroeconomics are about activities that determine the performance of the economy based on the intricate interaction of variables relating to the components of the economic system. Economic growth is about relationships among such factors as competitive behaviour and equilibrium dynamics, diminishing returns and the accumulation of physical and human capital, the interplay between per capita income and the population growth rate, and the effects of technological progress on the capabilities of factors of production

The relationship between production and consumption is the bedrock upon which all other factors revolve in driving economic growth. Hence, macroeconomic policies for generating growth require effective coordination of production and consumption, the intensity of which leads to discoveries of more sophisticated methods of production through which technological progress occur to accelerate economic growth. Technological progress enhances the productivity of factors of production thereby increasing the absorptive capacity of the economy. Through inter-sectoral linkages and response to incentives, sectors of the economy expand production by mutually self-perpetuating processes to create opportunities for economies of scale

Effective governance, resource endowments, and demography are critical factors that need to be properly harnessed along with sound economic principles to underpin strong economic growth. The efficacy of regulatory framework to create enabling conditions for nurturing and bolstering robust value-adding production structures anchored on appropriate macroeconomic management are the fundamental building blocks of strong economic growth. In accordance with these essential principles that elucidate the essence of macroeconomics in achieving strong economic growth, this book brings together a collection of chapters by experts in the field. Macroeconomic Analysis for Economic Growth examines different aspects of macroeconomics that

Section 1, "Macroeconomics of Economic Growth," begins with an introductory chapter that discusses the analytical convergence of various economic growth models with macroeconomic policy insights emanating from them. Chapter 2 presents an investigation into the key factors behind the impressive growth of the Ugandan economy, revealing that government consumption and investment have been crucial determinants of the strong growth trajectory overshadowing such drawback variables as inflation, foreign aid, and structural adjustment disruptions. Chapter 3 is an empirical evaluation of the theory of life-cycle hypothesis in Tunisia based on the uncertainties that becloud the ageing population with inadequate savings amid employment challenges, concluding that without employment the life-cycle expectation is untenable. Chapter 4 argues that instead of foreign direct investment (FDI), Sub-Saharan African (SSA) countries are facing the challenge of

in the discovery of new goods and methods of production.

that translate into the lower per-unit cost of production.

are germane to achieving strong economic growth.
