Pages: (1-11 )
Abstract
The population-growth debate in economic literature across developing economies has been inconclusive. The Kenyan population tripled from 15.6 million to over 52 million over four decades ago, while the economic growth trend revealed significant fluctuations. This paper therefore, examined the direction of causality between demographic changes and economic growth in Kenya. The VAR and VECM models were formulated and evaluated. The research findings revealed a bi-directional causality between life expectancy at birth and GDP per capita. In contrast, there was no causality between Fertility rate and economic growth over the years. Furthermore, there was a bi-directional causality between population growth and GDP per capita. Therefore, the paper concluded that there is a mutual link between demographic changes and economic growth in Kenya. Hence, effective family planning, strong health education, and human capital investment are necessities to sustaining economic growth in Kenya.
Keywords: Demographic changes, Economic growth, Fertility rate, Granger causality, Life expectancy, and Population,