Monetary and Fiscal Policy Factors That Affect Construction Output in Kenya
Emmanuel Thyaka Mbusi1, Titus Kivaa Mbiti2, Githae Wanyona3
1Emmanuel Thyaka Mbusi, Msc. Studendent At Jkuat, B Phil Tech Construction Management (UON), HDIP Valuation and Estate Management (KPUC), MISK, Kenya.
2Dr. Titus Kivaa Mbiti, Ph.D (RMIT, Australia), MA (Bldg Mngt, UON) BA (Bldg Econ, UON), CIQSK, RQS, Kenya.
3Dr. Wanyona Githae, B.A Blding Econs (U.O.N), M. Engineering (Kyoto University, Japan), PHD (UCT), RSA, Kenya.
Manuscript received on October 14, 2015. | Revised Manuscript received on October 26, 2015. | Manuscript published on November 05, 2015. | PP: 16-20 | Volume-5 Issue-5, November 2015 . | Retrieval Number: E2732115515/2015©BEIESP
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Abstract: The main role of construction industry is provision of physical constructed facilities to give other activities space for taking place Hillebrandt, (2000). She further observes that, these constructed facilities are referred to as construction output and are quantified on monetary terms. This quantification is done by Kenya National Bureau of Statistics in this country. Construction industry in Kenya mostly maintains an upward trend in its growth. Recently; 2013 and 2014, an economic survey report released by KNBS showed Kenya’s building and construction as having contributed 4.8% to the Gross Domestic Product (GDP). The GDP rose from Kshs.4.73 trillion to Kshs.5.36 trillion in 2014 Macharia, (2015). This gives an indication that the sector is growing, though at a slow pace. Description of monetary and fiscal policy factors in Kenya was thought of, as a way of sensitization to the construction sector stakeholders and players about them. These factors play a key role in decision making concerning construction projects, but are usually not accounted for carefully at this crucial stage of decision making. Time series data was collected on quarterly bases for the period between 2000 and 2013, for the five factors. This data showed normal distribution for all the variables with the mean and median being very close. It was concluded that in Kenya, there are five monetary and fiscal policy factors that affect construction output and hence policy makers, stakeholders and players in the sector should give these factors a fair consideration during decision making stage. This will foster growth in the sector and push the country’s GDP towards the ardently desired two digit growth.
Keywords: Construction output, time series, fiscal policy, monetary policy.