Capital Flight In Kenya Case Study

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ABSTRACT
Capital is a phenomenon which though unobservable is assumed to be prevalent in developing countries Kenya being among, this study is aimed at Evaluating capital flight volatility on Kenyan domestic investment and also finding out whether real interest rate differential, real exchange rate, foreign direct investment, inflation rate and external debts influence capital flight and also determining the type of relationship that exist between capital flight and domestic investment and finally determining its trend from 2004-2014. The research will be guided by the following research questions:
1. What is the existing relationship between domestic investment and capital flight in Kenya?
2. Does
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Determine relationship between capital flight and domestic investment
2. To determine whether capital flight is influenced by real interest rate differential, real exchange rate, inflation rate, external debt and net foreign direct investment.
3. Determine the trend of capital flight in the country
1.4 RESEARCH QUESTIONS
The research will be guided by the following research questions;
1. What is the existing relationship between domestic investment and capital flight in Kenya?
2. Does real interest rate differential, real exchange rate, inflation rate, external debt and net foreign direct investment influence capital flight?
3. What is the trend of capital flight in Kenya considering the fact that capital flight has continued according to prior reports?
1.5 RESEARCH HYPOTHESES
1. Capital flight has no significant relationship with domestic investment.
2. Real interest rate differential, real exchange rate, inflation rate, external debt and net foreign direct investment have insignificant influence on capital flight.
3. Capital flight doesn’t have a profile trend in Kenya

1.6 LIMITATION OF THE STUDY
The main limitation of this study will be time and this will limit the researcher from carrying out research regarding capital flight for long period of time and also only

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