Twine, Edgar E.Kiiza, BarnabasBashaasha, Bernard2022-10-092022-10-092015Twine, E. E., Kiiza, B., & Bashaasha, B. (2015). The flexible accelerator model of investment: An application to Ugandan tea-processing firms. African journal of agricultural and resource economics, 10(311-2016-5623).https://ageconsearch.umn.edu/record/200590/https://nru.uncst.go.ug/handle/123456789/4896The study uses the flexible accelerator model to examine determinants of the level and growth of investment in machinery and equipment for a sample of tea-processing firms in Uganda. Using a dynamic panel data model, we find that, in the long run, the level of investment in machinery and equipment is positively influenced by the accelerator, firm-level liquidity, and a favourable investment climate in the country. Depreciation of the exchange rate negatively affects investment. We conclude that firm-level strategies that increase output and profitability, and a favourable investment policy climate, are imperative to the growth of the tea industry.enAccelerator modelFixed asset investmentsUgandan tea-processing firmsArticle