Modelling Economic Determinants Of Youth Unemployment In Kenya

Despite numerous interventions by government and development partners, youth unemployment has \nremained an intractable challenge in Kenya. The “youth bulge” and attending challenges of \nunemployment resulting in social evils and political violence (rioting, civil war and terrorism) are \noverwhelming. This study therefore analyzes the economic determinants of youth unemployment in \nKenya from 1979 to 2012 by investigating empirical relationship among youth unemployment, gross \ndomestic product, population, foreign direct investment, and external debt. It is hypothesized that \nthese factors have a long-run relation and effect on youth unemployment rate in Kenya’s economy. \nThe study used Autoregressive Distributed Lag (ARDL) to test the economic determinants of youth \nunemployment. At 5% significance level, empirical results indicate that population; gross domestic \nproduct, foreign direct investment, and external debt are significant economic determinants of youth \nunemployment in Kenya in the long-run.