Economic growth - Quality of life nexus in Ethiopia: Time series analysis

Abstract

This study investigates the nexus between economic growth and quality of life (QoL) in Ethiopia by using objective indicators of QoL-variables from economic, social and political aspects by employing descriptive and time series analysis methods. The results from the descriptive analysis confirmed an increasing trend in all objective indicators. Where, education enrolment and consumption expenditure are showing strong correlation with economic growth. The co-integration and VECM results revealed that economic growth positively and significantly influences consumption expenditure and education enrolment in the SR and more strongly in the LR. However, it has shown a negative impact on political rights in the LR unlike in the SR where the impact is insignificant. The study also identified the existence of considerable relationship among the indicators. Urbanization is oppressing education enrolment and political rights in the SR unlike the LR case. Adjustments to the SR path of urbanization through timely provision of social services in rapidly urbanizing areas are suggested for circular improvement of Qol.

Keywords: Quality of life, Economic growth, indicators of QoL, Cointegration and Error correction model, Ethiopia