4.1 Introduction
In this chapter, the researcher used to apply the econometrics
method in order to verify the research hypotheses of the study, the researcher
has developed different points like: summary statistics, correlation matrix,
specification of the model, expected signs, data processing, model estimation
and diagnostic tests by using the data of Rwandan economy on the period from
2007Q1 up to Q42017Q4.
4.2 SUMMARY STATISTICS
The table below summarized quantitative data using mean, median,
maximum, minimum,
standard deviation, skewness and kurtosis. The results are
displayed in Table 1 below. Table 1: Summary Statistics
|
LGDP
|
LDT
|
LTGS
|
LTITT
|
|
Mean
|
6.975523
|
4.043814
|
4.282138
|
2.590486
|
|
Median
|
7.040119
|
4.142989
|
4.303782
|
2.58242
|
|
Maximum
|
7.593374
|
4.835751
|
5.043064
|
3.243469
|
|
Minimum
|
6.182085
|
2.937524
|
3.322205
|
1.933846
|
|
Std. Dev.
|
0.388659
|
0.546176
|
0.499604
|
0.386691
|
|
Skewness
|
-0.30232
|
-0.32776
|
-0.23712
|
0.024329
|
|
Kurtosis
|
2.099475
|
1.923937
|
1.936236
|
1.779536
|
|
Observations
|
44
|
44
|
44
|
44
|
Source: Eviews 8,2019
The statistics from Table 1 is based on 44 Quarterly
observations from Q12007 to Q42017. Over the study period, natural logarithm of
Nominal GDP which is the dependent variable ranged between a maximum value of
7.593374 and a minimum value of 6.182085, with an average of 6.975523. It
recorded a standard deviation of 0.388659, indicating that the data cluster
scatted away the average. The natural logarithm of DT has a mean of 4.043814,
with sample ranging between 4.835751 and 2.937524. LDT had a higher standard
deviation of 0.546176 in the series. natural logarithm of TGS,
recorded the mean of 4.282138 with standard deviation of 0.499604 and a minimum
and maximum value of 3.322205 and 5.043064 respectively. natural logarithm of
TITT obtained the mean value of 2.590486 and the standard
deviation of 0.386691, a minimum value of 1.933846 and a maximum value of
3.243469.
4.3 CORRELATION MATRIX
Correlation matrix showed the Relationship between FDI dependent
and independent variables
Table 2 Relationship between FDI dependent and
independent variables
|
LGDP
|
LDT
|
LTGS
|
LTITT
|
|
LGDP
|
1
|
0.98334
|
0.99452
|
0.89571
|
|
LDT
|
0.98334
|
1
|
0.97934
|
0.88471
|
|
LTGS
|
0.99452
|
0.97934
|
1
|
0.90128
|
|
LTITT
|
0.89571
|
0.88471
|
0.90128
|
1
|
Source: Eviews 8,2019
Table 2 shows the relationship between the
dependent variable GDP with independent variables DT, TGS and TITT.The
correlation between GDP and DT, TGS and TITT is positive and significant. It is
noted that the highest relationship of 99.45% is exhibited by the correlation
between GDP and TGS. This implies that TGS is the most important variable
correlated with GDP for the period under consideration from Q12007 up to
Q42017. TGS in correlation with GDP is followed by DT and TITT respectively.
That is to mean that there is a relationship between independent variables with
GDP in Rwanda during the period of study. However, these preliminary results
are insufficient for reaching a conclusion, and further tests will be carried
out in the following subtopics.
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