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On The Cyclicality Of South African Fiscal Policy

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  • John Thornton

Abstract

This paper examines the cyclicality of government revenue, spending and the key fiscal balances in South Africa during 1972‐2001. The results suggest that while government revenues were largely acyclical, government spending appears to have been predominantly counter‐cyclical, in line with the recommendations of neoclassical analysis. In addition, countercyclical government spending appears to have translated into a countercyclical policy stance overall. This finding contrasts markedly with the results from other empirical studies of South Africa and other emerging market and developing economies, which typically indicate procyclical fiscal policy.

Suggested Citation

  • John Thornton, 2007. "On The Cyclicality Of South African Fiscal Policy," South African Journal of Economics, Economic Society of South Africa, vol. 75(2), pages 258-264, June.
    • Handle: RePEc:bla:sajeco:v:75:y:2007:i:2:p:258-264
    DOI: 10.1111/j.1813-6982.2007.00114.x
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    References listed on IDEAS

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    9. Julia Darby & V. Anton Muscatelli & Graeme Roy, "undated". "How do Sub-Central Government react to cuts in grants received from Central Governments Evidence from a Panel of 15 OECD Countries," Working Papers 2005_18, Business School - Economics, University of Glasgow, revised Jun 2005.
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    Cited by:

    1. Sarra Ben Slimane & Moez Ben Tahar, 2010. "Why Is Fiscal Policy Procyclical in MENA Countries?," Working Papers 566, Economic Research Forum, revised 11 Jan 2010.
    2. Sean J. Gossel & Nicholas Biekpe, 2013. "The Cyclical Relationships Between South Africa's Net Capital Inflows and Fiscal and Monetary Policies," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 49(2), pages 64-83, March.
    3. Mawejje, Joseph & Odhiambo, Nicholas M., 2022. "The determinants and cyclicality of fiscal policy: Empirical evidence from East Africa," International Economics, Elsevier, vol. 169(C), pages 55-70.
    4. Stan Du Plessis & Ben Smit & Federico Sturzenegger, 2007. "The Cyclicality Of Monetary And Fiscal Policy In South Africa Since 1994," South African Journal of Economics, Economic Society of South Africa, vol. 75(3), pages 391-411, September.
    5. Eugene Msizi BUTHELEZI, 2023. "Impact of Fiscal Consolidation on Government Debt in South Africa: Evidence to Structural and Cyclical Effect," Journal of Economics and Financial Analysis, Tripal Publishing House, vol. 7(2), pages 1-23.
    6. Joseph Mawejje & Nicholas M. Odhiambo, 2022. "Macroeconomic determinants of fiscal policy in East Africa: a panel causality analysis," Journal of Economics, Finance and Administrative Science, Emerald Group Publishing Limited, vol. 27(53), pages 105-123, February.

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