Factors Affecting Investment Decision in Nepal

Authors

  • Basu Dev Dhungel Department of Economics, Ratna Rajyalaxmi Campus, Kathmandu, TU.
  • Kul Prasad Lamichhane Department of Economics, Ratna Rajyalaxmi Campus, Kathmandu, TU.

DOI:

https://doi.org/10.3126/tuj.v36i02.46641

Keywords:

convergence, gross domestic product, time series, cointegration, unit root

Abstract

This article, Factors Affecting Investment Decision in Nepal, has focused on the macroeconomics factors (gross domestic product, interest rate, and government expenditure) affecting the investment decision during 1975/762017/18. Based on time-series dataata macro level, this study employed Engel Grangerco integration test, as well as error correction model, investigated the short-and long-run causal relationship between gross investment and the factors influencing the investment decision of the investors, and found a statistically significant relationship between gross investment and macroeconomic variables. Furthermore, the coefficient of error correction term (-0.90) implied around a 90percent conversion to the equilibrium, showing a steady, long-run relationship between regress and  regressors.

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Author Biographies

Basu Dev Dhungel, Department of Economics, Ratna Rajyalaxmi Campus, Kathmandu, TU.

Associate Professor

Kul Prasad Lamichhane, Department of Economics, Ratna Rajyalaxmi Campus, Kathmandu, TU.

Associate Professor

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Published

2021-12-31

How to Cite

Dhungel, B. D., & Lamichhane, K. P. (2021). Factors Affecting Investment Decision in Nepal. Tribhuvan University Journal, 36(02), 67–80. https://doi.org/10.3126/tuj.v36i02.46641

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Section

Articles