Understanding the Influences on Private Investment in Barbados during the 1966-1990 Period
Anthony P. Wood

Abstract
This paper employs cointegration theory and the error correction mechanism to examine the influences on private investment behavior in the Barbadian economy during the period 1966-1990. The estimation results indicate that changes in output, government investment and the supply of credit to the private sector are significant in explaining short-run variations in private investment. These variables, along with real interest rates, also have significant influences on private investment in the long run.

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