The Impact of Investment, Saving, and Consumption on Economic Development in Algeria (1990-2019)

Abdelbaki, Bdiaf; Korichi, Khayreddine; Redjem, Khaled

مجلة بحوث الإدارة والاقتصاد
Volume 5, Numéro 4, Pages 231-248
2023-12-31

The Impact Of Investment, Saving, And Consumption On Economic Development In Algeria (1990-2019)

Authors : Abdelbaki Bdiaf . Korichi Khayreddine . Redjem Khaled .

Abstract

The aim of this study was to analyze the determinants of economic development in Algeria during the period of 1990-2019. Investment, savings, and consumption were used as independent variables, while gross domestic product (GDP) was used as the dependent variable. The Toda-Yamamoto methodology was used, which relies on the vector autoregression (VAR) model. This methodology does not take into account the stability of time series, thus avoiding the problem of spurious regression. According to this methodology, the study concluded that there is a two-way causal relationship between investment, savings, consumption, and GDP. This means that investment, savings, and consumption directly affect the increase in GDP by creating value surpluses and driving production.