Measuring Potential Output and Output Gap and Macroeconomic Policy: The Case of Kenya

Measuring the level of an economy.s potential output and output gap are essential in identifying a sustainable non-inflationary growth and assessing appropriate macroeconomic policies. The estimation of potential output helps to determine the pace of sustainable growth while output gap estimates provide a key benchmark against which to assess inflationary or disinflationary pressures suggesting when to tighten or ease monetary policies. These measures also help to provide a gauge in the determining the structural fiscal position of the government. This paper attempts to measure Kenya.s potential output and output gap using alternative statistical techniques and structural methods. Estimation of potential output and output gap using these techniques shows varied results. The estimated potential output growth using different methods gave a range of .2.9 to 2.4 percent for 2000 and a range of .0.8 to 4.6 for 2001. Although various methods produce varied results, they however provided a broad consensus on the over-all trend and performance of the Kenyan economy. This study found that firstly, potential output growth is declining over the recent time and secondly, the Kenyan economy is contracting in the recent years.

The Nature of Genetic Engineering and the Uses and Potential Abuses of Biotechnology

Over the past decade the topic of genetic engineering has been has been readily debated in the media, but often these debates consist of political rhetoric and fail to offer objective information on the methods and the potential benefits to human health and their environment. In truth, humans have been manipulating the genomes of organisms for thousands of years, and it has been an evolution of scientific knowledge that has led to the more precise methods of genetic engineering. This paper discusses how scientists utilize natural processes to alter the genetic constituents of both prokaryotic and eukaryotic organisms, benefits to human health and the environment, as well as potential misuses of biotechnology such as bioterrorism.