Government Investment in Tanzania Boosts Economic Growth, Cuts Consumption for Prosperity.
The government of Tanzania can boost long-term economic growth by shifting spending from consumption to investments in physical and human capital. Investing in infrastructure and education positively impacts economic growth, while spending on consumables hinders growth. Switching funds from consumption to capital investments benefits the economy, but the reverse slows growth. There are no negative effects on output when reallocating spending between physical and human capital investments.