Dynamic Research Journals (DRJ)

Journal of Economics and Finance (DRJ-JEF)

Volume 2 ~ Issue 6 (June, 2017) pp: 29-39
ISSN (Online); 2520-7490
www.dynamicresearchjournals.org

Population Growth in Zimbabwe: A Threat to Economic

Development?
Thabani Nyoni & Wellington G. Bonga

Abstract: Population growth is one of the fundamental factors that directly determine the supply of human
resources which are indisputably critical for production. Population growth plays a pivotal role in countrys
economic development trajectory. Most economically developed countries have significantly high populations,
for instance, the United States (324 million by end of 2016) and China (1.378 million by end of 2016). This
study seeks to unbundle the impact of population growth on economic development in Zimbabwe. The results of
the model show that the impact of population growth on economic development is positive and significant. The
study also found out that FDI (foreign direct investment), exports, inflation rate, and interest rate also
significantly affect economic development in Zimbabwe. The government is advised to put measures as to
promote population growth in Zimbabwe since it positively influences economic development.
Keywords: Demand, Export Growth, Economic Development, Population Growth, Private Consumption,
Investment, OLS Model, Zimbabwe.
JEL Codes:- C22, D24, E23, E24, F63, I30, J10, O11, O15, O47, P23.

I. INTRODUCTION
The scholarly debate on the relationship between population growth and economic development has a
very long history. The very aged debate on population-development, as noted by Todaro & Smith (2006), is yet
to continue into the future. Since Thomas Malthus 1798 book on population, numerous researchers have
considered the imbalance between population and resources. The fact that population growth may affect
economic development if it affects the supply and demand for savings and the efficiency of capital is palatable
to a plethora researchers e.g Kelly (1976, 1988); Hammer (1986); Mason (1988); Shumaker & Clark (1992);
Olson (1994); and Timmer (1994). Orthodox sagacity points to yet another objective consensus, that the
population-resource imbalance cannot be overlooked because it has important implications, especially on
economic development.
Figure 1: Population growth trends in Zimbabwe (1980-2015)

POP Linear (POP)

4.5
POP Growth-Annual %

4
3.5
3
2.5
2
1.5
1
0.5
0
1975 1980 1985 1990 1995 2000 2005 2010 2015 2020
Year

The trend in population growth in Zimbabwe over the period 1980-2015 is shown in figure 1 above. The
figure shows that the trend in population growth in Zimbabwe is generally downwards as clearly indicated by
the trend line inserted (that red line sloping downwards). The figure shows that Zimbabwe recorded the highest
population growth in 1984 at 3.956%. However, the increasing trend was then reversed in 1985 when population
growth fell to 3.845%. The downward trend continued from 1985 to 2003 when it had hit an all-time low of

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 Population Growth in Zimbabwe: A Threat to Economic Development?

0.65%. This is the area covered by the bold double arrow in the figure above. Since then, population growth in
Zimbabwe started increasing, from 0.731% in 2004 to 2.314% in 2015. Zimbabwes population, as noted by
ZimStats (2016) is projected to increase. These projections, according to ZimStats (2016) are premised on rising
life expectancy rates due to reduced HIV/AIDS-related deaths, improved public health systems, expanding
educational levels, rising incomes and urbanization.

II. STYLIZED FACTS ABOUT POPULATION GROWTH

Figure 2: Spiraling World Population

As shown in the figure above, world-wide population growth is projected to increase. World
population growth in 2011 was approximately 7 billion. It is projected to reach 7.5 billion by 2020, while by
2050 world population growth is expected to reach 8.9 billion.

Table 1: Most Populous Countries in the World

Country, 2016 Population (millions) Country, 2050 Population (millions)
China 1.378 India 1.708
India 1.329 China 1.344
United States 324 United States 398
Indonesia 259 Nigeria 398
Brazil 206 Indonesia 360
Pakistan 203 Pakistan 344
Nigeria 187 Brazil 226
Bangladesh 163 Congo. Dem. Rep. (DRC) 214
Russia 144 Bangladesh 202
Mexico 129 Egypt 169
Data Source: 2016 Population Reference Bureau

In 2016, as shown in the table above, China had the highest population of approximately 1.378 billion,
followed by India with a population of 1.329 billion people. This shows that there are more people in Asia than
in any other part of the world. In 2016, the United States ranked number 3 as shown in the table above, with a
population of 324 million people. Closer to home, Nigeria was ranked 7th amongst the top 10 most populous
countries with a population of 187 million people. Population growth projections show that by 2050 India will
be most populous country with an estimated 1.708 billion people. However, Chinas population is expected to
slightly decrease to 1.344 billion people, probably due to Chinas policy stance of discouraging large families.
By 2050, the United States is projected to increase to 398 billion. Africas population growth is also poised to
increase as indicated by the projected increase in population in Nigeria, DRC and Egypt; to 398 billion, 214
billion and 169 billion people. Zimbabwe, whose population is estimated to be approximately 16 million, is far
away from being one of the worlds most populous countries. After all, Zimbabwe has abundant natural
resources, most of which are either under-utilized or not being utilized at all. Therefore, an increase in
population growth is likely to trigger economic development.

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 Population Growth in Zimbabwe: A Threat to Economic Development?

Table 2: Highest and Lowest Total Fertility Rates, 2016

Highest Lowest
Niger 7.6 Korea, South 1.2
South Sudan 6.7 Romania 1.2
Congo.Dem.Rep (DRC) 6.5 Singapore 1.2
Chad 6.4 Taiwan 1.2
Somalia 6.4 Bosnia-Herzegovina 1.3
Burundi 6.1 Greece 1.3
Angola 6.0 Moldova 1.3
Mali 6.0 Poland 1.3
Mozambique 5.9 Portugal 1.3
Uganda 5.8 Spain 1.3
Data Source: 2016 Population Reference Bureau
The table above shows highest and lowest total fertility rate for various countries around the world for
the year 2016. Niger has the highest total fertility rate of 7.6 followed by South Sudan whose total fertility rate
is 6.7. In fact, it can be observed from the table above that only African countries are ranking very high in terms
of total fertility rates. Mozambique and Uganda, amongst the African countries, have relatively lower total
fertility rates of 5.9 and 5.8 respectively. However, the table also shows that Asian countries (South Korea,
Romania, Singapore, Taiwan and Bosnia-Herzegovina), although they have relatively lower fertility rates as
compared to African countries, they still have higher rates if compared to European countries (Greece, Moldova,
Poland, Portugal and Spain) whose total fertility rates are the lowest, with Spain having a lowest total fertility
rate of 1.3
Demographic Indicators (population-mid-2016; population-mid-2030 & 2050; Urban percent; life
expectancy at birth; GNI per capita)-Zimbabwe and other African countries
Table 3
Country Population Population Population Percent Life Life GNI per
Mid-2016 Mid 2030 Mid 2050 Urban expectancy expectancy capita
(millions) (millions) (millions) At birth- At birth- (US$)-for
males females the year
2015
Zimbabwe 16 22.2 33.2 33 56 59 1 700
Botswana 2.2 2.7 3.3 57 62 67 15 600
Lesotho 2.2 2.6 3.4 27 50 50 3 160
Namibia 2.5 3.3 4.7 47 62 67 10 380
South Africa 55.7 63.4 75.2 65 60 64 12 830
Swaziland 1.3 1.5 1.8 21 50 48 8 040
Angola 25.8 39.4 65.5 62 51 54 6 450
Zambia 15.9 24.1 41.0 40 51 56 3 700
Uganda 36.6 58.1 101.5 20 62 64 1 780
Tanzania 54.2 81.5 134.8 30 64 66 2 620
Mozambique 27.2 41.9 74.4 32 52 56 1 170
Malawi 17.2 23.4 32.2 16 62 64 1 140
Kenya 45.4 63.7 88.2 26 60 65 3 060
Ethiopia 101.7 132.9 168.6 20 62 66 1 620
Burundi 11.1 17.2 30.4 12 58 61 730
Rwanda 11.9 16.4 23.6 29 62 66 1 720
Nigeria 186.5 261.9 397.5 48 53 53 5 800
Ghana 28.2 37.1 50.4 54 60 63 4 070
Algeria 40.8 50.6 63.2 71 73 78 14 280
Egypt 93.5 121.6 168.8 43 70 73 10 690
Tunisia 11.3 13.1 14.9 68 73 77 11 060
Data Source: 2016 Population Reference Bureau
Table 3 shows that, Zimbabwe had an estimate population of 16 million people. Population in
Zimbabwe is projected to increase to approximately 22.2 million by mid-2030 while it is projected to increase to
33 million by mid-2050. These figures are much higher than other SADC countries such as Botswana, Lesotho,
Namibia, Swaziland and Zambia amongst others as shown in the table above. Most people in Zimbabwe live in

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 Population Growth in Zimbabwe: A Threat to Economic Development?

rural areas as shown by a figure of 33% of total population living in urban areas; meaning to say, 77% of
Zimbabwes population resides in rural areas. However, we expect the number of people in urban areas to
increase from the current 33% of total population to over 50% of total population, due to fast growing
urbanization in Zimbabwe. Other African countries have more people in urban areas e.g Tunisia has got 68% of
its population living in urban areas. Life expectancy (at birth) in Zimbabwe is currently pegged at 56 years for
males and 59 years for females, this has been necessitated by the availability of ARVs (anti-retro-virals) among
other essential medicines in Zimbabwe. GNI per capita (which is $1 700) is relatively low as compared to other
African countries e.g Angola ($6 450), Nigeria ($5 800) and Ghana ($4 070). This can be attributed to economic
hardships and political volatility in Zimbabwe.
Demographic Indicators (birth per 1000 population; maternal deaths per 100 000 births; deaths per
1000 population; infant mortality rate; total fertility rate; % of population below 15 years & above 65 years of
age)-Zimbabwe and other African countries
Table 4
Country Birth per Maternal Deaths per Infant Total % %
1000 Deaths 1000 mortality fertility population population
population per 100 population rate rate below 15 above 65
000 births years of years of
age age
Zimbabwe 36 443 10 50 4.0 42 3
Botswana 25 129 8 31 2.8 33 5
Lesotho 29 487 15 59 3.3 36 5
Namibia 29 265 7 39 3.6 34 4
South Africa 22 138 10 34 2.4 30 5
Swaziland 29 389 14 50 3.3 37 4
Angola 45 477 14 93 6.0 48 2
Zambia 43 224 13 52 5.3 46 3
Uganda 43 343 10 53 5.8 48 3
Tanzania 37 398 7 43 5.2 45 3
Mozambique 45 489 14 81 5.9 45 3
Malawi 34 634 10 42 4.4 40 4
Kenya 31 510 7 39 3.9 42 3
Ethiopia 30 353 7 47 4.2 41 3
Burundi 42 712 10 63 6.1 46 2
Rwanda 34 290 7 32 4.2 4 3
Nigeria 39 814 13 69 5.5 43 3
Ghana 33 319 8 41 4.2 39 5
Algeria 26 140 5 21 3.1 29 6
Egypt 31 33 6 22 3.5 31 4
Tunisia 20 62 7 17 2.4 24 8
Data Source: 2016 Population Reference Bureau
As shown in the table above, Zimbabwes crude birth rate (birth per 1000 population) is 36 and is
much higher than crude birth rates in other African countries e.g Lesotho (29), Kenya (31) and Algeria (26).
However, countries such as Mozambique (45) have much higher crude birth rates. Maternal deaths per 100 000
births in Zimbabwe are 443; infant mortality is 50, while deaths per 1000 population are 10. These figures are
too high for a small country like Zimbabwe. A lot needs to be done especially in terms of improving health
service delivery in Zimbabwe. Total fertility rate in Zimbabwe is pegged at 4. This is much lower than Nigers
fertility rate of 7.6 as shown in the table 2 above. This could be attributed to the high use of contraceptives in
Zimbabwe. However, low fertility rates militate against population growth. Since 42% of the population in
Zimbabwe is below 15 years while only 3% of the population in Zimbabwe is above 65 years, it can be deduced
that 55% of Zimbabweans are aged between 15 years and 65 years. This confirms the fact that most people in
Zimbabwe are economically active citizens.

Purpose of the study

Much of modern Development Economics on population problems have centered on what could be the
optimum size and its impact on economic development. This line of reasoning emanated from the debate
triggered by the Malthusian population growth theory which basically argues that food production cannot keep
pace with the demands of a growing population. However, the applicability of this argument is not universal

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 Population Growth in Zimbabwe: A Threat to Economic Development?

especially given the fact that in industrialized economies, technological advances have spurred increases in
agricultural production which ensures food security for citizens. Population growth in Zimbabwe shows a
general downwards trend as shown in Figure 1 above. This a cause for concern given the fact that in this world
most economically developed countries are populous e.g the United States (which has approximately 324
million people as at 2016). Another important issue that is unique for Zimbabwe is that there are abundant
natural resources of which most of these resources are currently lying idle; which if properly used can spur
economic development. It is also important to note that investors are increasingly selective in that they now
prefer highly populated countries where they know there will be high demand (guaranteed market for their
products), no wonder why it is difficult to attract investors in Zimbabwe. There is need to conduct an empirical
investigation into the population growth-economic development relationship in order to properly advise the
government and other relevant stakeholders on the necessary steps to take with regards to population growth
dynamics in Zimbabwe.

Knowledge gap
Population growth plays an indispensable role in economic development of any nation. Thus
investigation is required into the population growth-economic development nexus in order to understand both
consequences and opportunities that may arise due to population growth. This study explicitly fills a gap in the
understanding of population growth dynamics from an economic point of view. This study comes at a time
when Zimbabwe is facing an ailing economy, therefore, it is envisioned that the results of this endeavor will
help in shaping Zimbabwes economic road map especially with regards to population growth.

III. LITERATURE REVIEW

3.1 Theoretical Literature Review
The Malthusian population trap is a famous theory of the link between population growth and
economic development. This theory states that human population grows geometrically while the means of
subsistence grows arithmetically being subject to the law of diminishing returns. The popularity of the
Malthusian population trap has convinced a plethora of development economists and policy makers that rapid
population growth is a threat to economic development. This is mainly attributed to the proposition that rapid
population growth results in tightening job markets, generating underemployment and discouraging labour force
mobility across sectors. Therefore, the Malthusian population trap argues that rapid population growth is a real
problem to any economy.
Solow (1956), unlike Malthus (1978), focused on the term population growth rate instead of the term
population level. In his analysis of population dynamics, Solow (1956), outlined that an increase in the
population growth rate can reduce the capital per worker as well as the steady-state output per worker. As a
result, higher population growth can retard productivity and economic growth.
Contrary to both Malthus (1798) and Solow (1956), there is another view popularized by researchers
such as Ahlburg (1998) and Becker et al (1999), which states that rapid population growth is not a problem at
all, but rather an opportunity for development. Ahlburg (1998) argued that larger population can lead to
technology pushed and demand pulled, which implies that higher population growth, can increase the need
for goods and services and boost technological advancement. As a result, it can significantly improve labour
productivity, increase income per capita and living standards.
According to Becker et al (1999), population is the strength of a nation because it is the source of real
wealth. High population growth rate implies high labour force, which is one of the most critical factors of
production. In this view, high labour force apparently means higher output of a particular production process.
However, Becker et al (1999), on the other hand agrees with both Malthus (1798) and Solow (1956), that rapid
population growth, indeed; retards economic development.

3.2 Empirical Literature Review

Kothare (1999) studied the relationship between population growth and economic development in India
and found that population growth has a positive effect on economic development. Albatel (2005) analysed
population growth and economic development in Saudi Arabia and found that rapid population growth has a
negative impact on both savings and economic growth. In an African study, Asongu (2011) looked at population
growth and investment in Africa and found a long-run positive causal linkage from population growth to only
public investment.
Adetiloye & Adeyemo (2012) analysed domestic investment, capital formation and population growth
in Nigeria. Their findings show that there is a negative relationship between growth rates of the population and
capital formation. In a similar study, Wako (2012), investigated demographic changes and economic
development in Ethiopia and found that there is a robust and negative long-run relationship between per capita
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income and population growth. Wakos descriptive analysis signified inverse associations of population growth
with landholding, forest coverage and HDI score. In Kenya, Thuku et al (2013), investigated population change
and economic growth and found out that population growth and economic growth are both positively correlated
and that an increase in population will impact positively to Kenyas economic growth.
Similarly, in Pakistan, Ali et al (2013), investigated the impact of population growth on economic
development and found that population growth has positively and significantly contributed to economic
development but is negatively affected by unemployment in Pakistan. They also found out that HRD (Human
Resource Development) was insignificant although positive Nwosu et al (2014) investigated the effects of
population growth on economic growth in Nigeria and they found that there is a sustainable long-run
equilibrium relationship between economic growth and population growth. They also found evidence of a
unidirectional causality between population growth and economic growth in Nigeria.
More recently, Zhang (2015), investigated the correlation between population growth and economic
development in Asian countries and concluded that population growth affects economic development in a
negative way in some developing countries such China, India and Indonesia. Similarly, Ali et al (2015) analysed
the impact of population growth on economic development in Bangladesh. Their results indicate that there is a
negative relationship between population growth and economic development in Bangladesh, while foreign
investment and export promotion only have a small impact on Bangladeshs economic growth. Tartiyus et al
(2015), analysed the impact of population growth on economic growth in Nigeria and found that there is a
positive relationship between economic growth and population, fertility and export growth; while negative
relationships were found between economic growth and life expectancy and crude death rate.

IV.MATERIALS & METHODS

4.1 Econometric Model
The research employed a simple Ordinary Least Squares (OLS) model; synonymous to the one used in
Pakistan by Afzal (2009) and in Bangladesh by Ali et al (2015). Data was analyzed using E-Views 7 software
package and STATA 11.1. The two statistical software complement each other in the calculation of important
statistics required for effective data analysis. The model is stated in linear form as below:
Yt = 0 + 1 POPt + 2 FDI t + 3 Et + 4 INFLt + 5 IRt + t (1)
Where,

Y is Economic Development as proxied by real GDP growth (annual percentages), POP is
population growth as measured in annual percentages, FDI is Foreign Direct Investment measured as
a percentage of GDP, E is exports growth measured in annual growth percentages, INFL is inflation
rate measured in annual percentages, IR is interest rate proxied by commercial lending rates (annual
percentages), 0 is the model constant, ( 1 5 ) are the estimation parameters, is the stochastic
term (white noise error term), and t represents the time dimension.

4.2 Data Sources

Data used in this research was gathered from the World Bank (WB): POP, FDI, E; and ZimStats
(Zimbabwe Statistic Agency): INFL, IR. Study data spun from 1980 to 2015.

4.3 Diagnostic Tests

4.3.1 Unit Root Test (Stationarity Test)
Time series models require working with stationary data to avoid spurious regression. The study used
the common Augmented Dickey-Fuller test (ADF) to check on the stationarity of the study variables. The
decision; a variable is said to be stationary if the ADF statistic is less than the critical value. The results of
the ADF test are shown in the table below;
Variable ADF Statistic Critical Values Conclusion
Y -3.762*** Stationary
POP -1.373 @ 1% = -3.682 Not Stationary
E -4.941*** @ 5% = -2.972 Stationary
FDI -3.345** @ 10% = -2.618 Stationary
INFL -5.121*** Stationary
IR -5.544*** Stationary
*** 1% significant level, ** 5% significant level

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The above table shows that all other variables are stationary except the POP variable. The study will
employ the differencing approach to stationarise the variable. the study will then employ the ADF test on
the new variable to check for unit root as well, and the process continues from fist difference, second
difference, third difference and so on until stationarity is attained. However, degrees of freedom will be lost
in the process. The results of the first difference and second difference are presented in the table below;
Variable ADF Statistic Critical Values Conclusion
DPOP -1.924 @ 1% = -3.696 Not Stationary
@ 5% = -2.978
@ 10% = -2.620
DDPOP -3.435** @ 1% = -3.702 Stationary, I(2)
@ 5% = -2.980
@ 10% = -2.622
** 5% significant level

The variable POP has become stationary after being differenced for the second time. The variable is
said to be integrated of order 2 [I(2)], and the stationary series DDPOP, will be used in the regressions.

4.3.2 Multicollinearity Test (Correlation Matrix)

e f di in fl ir d d po p

e 1 .0 0 00
fd i 0 .0 1 79 1 . 00 00
i nf l -0 .0 5 72 -0 . 12 24 1. 00 00
ir -0 .2 3 39 0 . 00 91 - 0. 00 34 1. 00 0 0
dd po p 0 .0 5 16 -0 . 32 43 - 0. 04 95 0. 06 3 6 1. 0 00 0
H0: there is perfect multicollinearity, H1: there is no perfect multicollinearity
Decision: We reject H0 since all the values are less than 0.8; and conclude that there is no perfect
multicollinearity.

4.3.3 ARCH LM Test

F-statistic: 0.996716 Probability: 0.167004
Obs *R-squared: 1.996904 Probability: 0.157621

H0: there is autocorrelation, H1: there is no autocorrelation

Decision: We reject H0 since, the p- value, 0.167004 is insignificant and; conclude that there is no
autocorrelation.

4.3.4 Durbin Watson (DW) Test

. e s t a t d w a ts o n

D u r b i n - W a t s on d - s t a t i s t ic ( 6, 34 ) = 1 . 8 7 8 88 5
H0: there is autocorrelation, H1: there is no autocorrelation
Decision: We reject H0 since the D.W test statistic is 1.8789 (which is approximately equal to 2). This
implies that the model does not suffer from the problem of serial autocorrelation; thus complementing the
results of the ARCH LM test above.

4.3.5 White Test

F-statistic: 0.428382 Probability: 0.918781
Obs*R-squared: 5.266306 Probability: 0.872693

H0: there is heteroscedasticity, H1: there is no heteroscedasticity

Decision: We reject H0 since the p-value, 0.918781, is insignificant and; conclude that there is no
heteroscedasticity.

4.3.6 Misspecification Test (R2 test)

H0: the model is not correctly specified, H1: the model is correctly specified
Decision: We reject H0 since R2 is greater than 0.6 (which is the rule of thumb); and conclude that our
model has been correctly specified. The model R-squared is 0.6404, with the adjusted R-squared being

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 Population Growth in Zimbabwe: A Threat to Economic Development?

0.5762. This particularly implies that the variables (in our model) are significant in explaining economic
development in Zimbabwe.

4.3.7 Testing for the significance of the whole model (F-statistic test)
H0: the model is not significant, H1: the model is significant
Decision: We reject H0 since the F-statistic, 9.97, has a probability of 0.0000; meaning that there is
approximately NO chance of rejecting the specified model. Thus the model is correctly specified and
valid.

V. EMPIRICAL RESULTS: PRESENTATION, INTERPRETATION & DISCUSSION

5.1 Presentation of Descriptive Statistics

The table below shows descriptive statistics of the variables included in the model. These descriptive
statistics are operationally referred to as measures of central tendency. The large gap between the maximum and
minimum indicates the existence of outliers in the e.g E (exports), INFL (inflation) and IR (interest rates).
However, the smaller gap between the maximum and the minimum of Y, DDPOP and FDI indicate that there
are no outliers in the variables. We can also notice that where there are outliers (E; INFL; IR), the standard
deviation is also relatively higher, e.g for E standard deviation is 19.8 whilst for IR standard deviation is 1760.1.
The rule of thumb for Kurtosis is that it should be around 3 for normally distributed variables. In the table
below, Y is normally distributed as shown by Kurtosis of approximately 3.4 whilst the rest of the variables are
not normally distributed but rather positively skewed.

Y DDPOP FDI E INFL IR

Mean 1.835806 2.211486 0.995000 3.225472 2.231389 378.1458
Median 2.3367000 2.000000 0.417000 -1.010500 1.120000 26.45000
Maximum 14.42100 3.996000 6.940000 92.70600 74.30000 10600.00
Minimum -17.66900 0.650000 -0.453000 -21.08400 -27.05000 7.500000
St. Dev. 7.563536 1.105353 1.462923 19.82851 14.98447 1760.059
Skewness -0.707082 0.314145 2.151424 2.740582 2.845671 5.669482
Kurtosis 3.418640 1.767203 8.672464 12.82440 16.38302 33.43456
Observations 36 34 36 36 36 36

5.2 Regression Model Results

The OLS regression results for the study, using the stationary variables are shown below;
S o ur c e SS df MS Nu m be r o f o bs = 34
F( 5 , 2 8) = 9. 9 7
M od e l 1 0 97 . 44 3 7 5 2 1 9. 48 8 74 1 Pr o b > F = 0 . 00 0 0
R es i du a l 61 6 .2 2 56 1 3 28 2 2 .0 08 0 57 6 R- s qu ar e d = 0 . 64 0 4
Ad j R -s q ua r ed = 0 . 57 6 2
T ot a l 17 1 3. 6 69 3 2 33 5 1 .9 29 3 73 2 Ro o t MS E = 4 . 69 1 3

y C o ef . S t d. Er r . t P >| t | [9 5% Co n f. In te r va l ]

e . 14 8 15 5 . 0 43 9 37 4 3. 3 7 0 .0 0 2 .0 58 1 53 4 . 23 8 15 6 6
fdi 1 . 72 5 11 3 . 5 97 8 41 8 2. 8 9 0 .0 0 7 .5 00 4 89 9 2 .9 4 97 3 7
in f l . 1 23 1 75 5 . 0 56 4 91 6 2. 1 8 0 .0 3 8 .0 07 4 57 7 . 23 8 89 3 3
ir -. 0 01 3 03 6 . 0 00 4 71 2 - 2. 7 7 0 .0 1 0 - .0 02 2 68 8 -. 00 0 33 8 5
d dp o p 2 . 92 6 37 7 . 8 51 5 18 5 3. 4 4 0 .0 0 2 1. 18 2 12 1 4 .6 7 06 3 4
_ co n s -6 . 99 4 93 1 2 . 37 1 39 3 - 2. 9 5 0 .0 0 6 - 11 .8 5 25 1 -2 .1 3 73 5 3

From the above regression results, all the variables are significant. This implies that, they all
significantly explain the economic development variable. As indicated by an adjusted R-squared of 0.5762, it
implies that about 57.62% variation in the economic development variable is explained by the included
explanatory variables. The model is correctly specified as indicated by the significance of the F-test, 9.97
(0.0000). The results can be presented by the following model;

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 Population Growth in Zimbabwe: A Threat to Economic Development?

Yt = - 6.995 + 2.926DDPOPt + 1.725FDI t + 0.148E t + 0.123INFL t - 0.001IR t

t - 2.95 3.44 2.89 3.37 2.18 - 2.77
p (0.006) (0.002) (0.007) (0.002) (0.038) (0.010)
Adjusted R 2 = 0.5762, DW - statistic = 1.8789

5.3 Interpretation and Discussion of Regression Results

Population growth variable (DDPOP). The coefficient for population has a positive sign and is
statistically significant at 1% level of significance. This means that an increase in population growth in
Zimbabwe will lead to positive economic development in Zimbabwe. Contrary to Malthus (1798) and Solow
(1956) population growth theories, these results confirm the pessimistic views of orthodox researchers such as
Ahlburg (1998) and Becker et al (1999), who argued that population growth is not a real problem at all. In
Zimbabwe, population growth is not a problem but rather an opportunity for growth. Zimbabwe is blessed with
vast natural resource endowments, most of which lie idle. Therefore, given this positive relationship between
population growth and economic development, it implies that if population growth increases in Zimbabwe, it
can lead to an increase in the need for goods and services (aggregate demand, which is currently very low) and
also boost technological advancement. Increase in population growth also means more labour supply for
industrialization. These results confirm previous studies such as Kothane (1990), Asongu (2011), Thuku et al
(2013), Ali et al (2013), Nwosu et al (2014) and Tartiyus et al (2015). However, our results on the other side of
the same coin, also contradict the findings of other previous studies who argue that population growth is harmful
to economic growth e.g Albatel (2005), Adetiloye & Adeyemo (2012), Wako (2012), Zhang (2015) and Ali et al
(2015).
FDI variable. FDI has a positive sign and is statistically significant at 1% level of significance. This
means that an increase in FDI in Zimbabwe will lead to improvement in economic development in Zimbabwe.
This is acceptable because FDI is an important source of economic development. In fact, FDI is an indisputable
source for technology spillovers as well as efficiency and growth for an economy as already highlighted by
various previous researchers such as Anderson & Gonzalez (2013) and Bayraktar (2011). The results are
consistent with previous studies done in Zimbabwe e.g Gwenhamo (2009), Moyo (2013), Sikwila (2014) and
Muzurura (2016).
Exports variable. The explanatory variable, exports, has a positive sign and is statistically significant
at 1% level of significance. This means that when there is an increase in exports in Zimbabwe, there will be
economic development. Exports can enhance economic development in Zimbabwe in the sense that the country
can be able to earn more foreign exchange reserves which can then be used to import those items which are
relatively scarce in Zimbabwe. Our results are consistent with the findings of Zaheer et al (2014). A study by
Bonga, Shenje and Sithole (2015), using a Vector Error Correction model found a significant long run
relationship between export growth and economic growth, which implies that in the long run export growth has
an impact on economic growth.
INFL variable. Inflation has a positive sign and is statistically significant at 1% level of significance.
This means that an increase in inflation rate in Zimbabwe will lead to an increase in economic development as
measured by increase in GDP growth. This is acceptable because higher anticipated inflation lowers the real rate
of interest, causing portfolio adjustments to move away from real money balances to real capital thereby raising
real investment and promoting economic development. Lower inflation rates currently obtaining in Zimbabwe
are quite favourable, however, attention should be taken as to avoid too low inflation, for instance, inflation
rates that are lower than zero percent (or in the negative territory). Many researchers e.g Nell (2000), Mallick &
Chowdhury (2001), Sergii (2009), Hasanov (2010) and Marbuah (2010) argue that inflation that is less than 9%
or generally low (single-digit inflation) is beneficial to economic growth. However, the results are contrary to
the main stream argument that inflation is harmful to economic development e.g Barro (1995) and Li (2003)
basing on the argument that expected high inflation raises the cost of acquiring capital, thereby reducing capital
accumulation and the fact that high inflation rates are an indicator of macroeconomic instability, which can have
adverse impact on economic development.
IR variable. This explanatory variable has a negative sign and is statistically significant at 1% level of
significance. This means that increasing interest rates causes negative economic development. Although our
results are consistent with previous studies e.g Semuel & Nurina (2015), they are also contrary to other studies
such as Obamuyi & Olorunfemi (2011) who found a positive relationship between interest rates and economic
development.

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 Population Growth in Zimbabwe: A Threat to Economic Development?

VI. RECOMMENDATIONS
Policy recommendations emanating from this study:
i. The government of Zimbabwe should put in place policies designed to encourage population
growth. For example, discouraging continuous use of contraceptives, especially by married
couples; improving health service delivery to address both maternal deaths and crude death
rates; as well as helping (the so-called subsidizing) large families among other such initiatives.
ii. The government should maintain a stable political and economic landscape in order to attract
the much needed FDI in Zimbabwe
iii. The government should continue offering incentives to exporters, however, such incentives
should be quite significant, far much better than the current Bond Notes incentives
iv. The government of Zimbabwe should also put measures as to increase inflation because
inflation in Zimbabwe is currently too low. This is not good for any economy. While it should
not be very high, inflation should also not be too low.
v. The government of Zimbabwe ought to intervene in the financial markets by reducing interest
rates because high commercial lending rates discourage investment and economic
development at large.
vi. Increased population growth implies increased demand for both local and foreign products.
Countries can utilize the demand for economic development through development of foreign
products substitutes and producing more for local demand.

VII. CONCLUSION
In the scholarly discourse on the impact of population growth on economic development, there are
basically two divided camps. The first and probably most prominent one, pioneered by Malthus (1798), is
pessimistic, arguing that population growth is a real problem for any economy; while the second one is
optimistic, arguing that population growth is not a real problem at all, but rather an opportunity for growth.
Despite the divergence of views regarding the desirability of population growth, this study has empirically
discovered that in Zimbabwe population growth is quite desirable if meaningful economic development is
poised to take place any time soon. We estimated a simple OLS model to empirically examine the nexus
between population growth and economic development in Zimbabwe. Diagnostic tests overwhelmingly
supported the statistical appropriateness of our model. A highly significant and positive coefficient of population
growth points to the fact that population growth is NOT a challenge but rather an avenue for economic
development in Zimbabwe.

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APPENDIX; DATA USED IN THE STUDY

YEAR Y E FDI POP INFL IR
1980 14.421 39.286 0.023 3.6 12.74 7.5
1981 12.525 12.525 0.044 3.81 6.6 13
1982 2.634 2.634 -0.009 3.94 3.86 13
1983 1.585 1.585 -0.027 3.996 -10.5 13
1984 -1.907 -1.907 -0.039 3.956 -16.6 13
1985 6.944 6.945 0.051 3.845 -17.02 13
1986 2.1 20.805 0.12 3.724 8.03 13
1987 1.151 -2.09 -0.453 3.596 7.19 13
1988 7.552 6.079 -0.231 3.414 7.89 13
1989 5.2 1.226 -0.123 3.174 0.8 13
1990 6.989 -0.048 -0.139 2.901 -0.92 13
1991 5.532 -4.38 0.032 2.62 -6.78 36.7
1992 -9.016 -5.323 0.221 2.357 -14.13 39.3
1993 1.051 22.773 0.426 2.126 -3.79 31.8
1994 9.235 9.39 0.503 1.938 -3.9 30.3
1995 0.158 0.487 1.655 1.782 3.04 34.7
1996 10.361 8.138 0.946 1.651 8.98 33.6
1997 2.681 5.518 1.584 1.522 -2.88 34.7
1998 2.885 -0.679 6.94 1.374 -27.05 49.3
1999 -0.818 -3.662 0.86 1.2 8.01 68
2000 -3.059 -7.732 0.347 1.013 0.63 68.5
2001 1.44 3.276 0.056 0.829 -0.13 31.3
2002 -8.894 -16.965 0.408 0.691 2.71 45.8
2003 -16.995 -20.437 0.066 0.65 8.8 346
2004 -5.808 -2.056 0.15 0.731 7.61 202.5
2005 -5.711 -7.342 1.786 0.902 5.14 415
2006 -3.461 -8.942 0.735 1.1 -2.02 500
2007 -3.653 -9.786 1.302 1.286 0.89 775
2008 -17.669 -21.084 1.169 1.476 1.35 10600
2009 5.984 -8.268 1.287 1.657 74.3 13.12
2010 11.376 92.706 1.301 1.826 4.09 18.63
2011 11.905 27.08 3.142 2 3.53 19
2012 10.565 -16.194 2.823 2.15 8.09 20.5
2013 4.484 -1.342 2.765 2.258 0.82 22.6
2014 3.848 -3.069 3.33 2.307 0.65 20.1
2015 0.474 -3.03 2.769 2.314 0.3 19.3

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