IDEAS home Printed from https://ideas.repec.org/a/eei/journl/v64y2021i1p1-22.html
   My bibliography  Save this article

A Revival of Budget Deficit and Economic Growth

Author

Listed:
  • Elisha Mavodyo

Abstract

South Africa has experienced high budget deficits accompanied by sluggish economic growth over the years. Fears mount that such a trend may worsen due to the advent of the Covid-19. Yet, the effect of budget deficit on economic growth remains one of the widely debated topics in economics. This article gives empirical evidence on the budget deficit-economic growth nexus and the deficit spending channels that are growth stimulating in South Africa over the period 1980 to 2018. Relying on the Dynamic Ordinary Least Squares (DOLS), results show that budget deficit is growth promoting and that budget deficit is growth stimulating if it is channelled towards export-oriented industrialisation of ores and metals.

Suggested Citation

  • Elisha Mavodyo, 2021. "A Revival of Budget Deficit and Economic Growth," Journal of Economics and Econometrics, Economics and Econometrics Society, vol. 64(1), pages 1-22.
    • Handle: RePEc:eei:journl:v:64:y:2021:i:1:p:1-22
    as

    Download full text from publisher

    File URL: https://ideas.repec.org/a/eei/journl/v64y2021i1p1-22.html
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item

    Keywords

    DOLS; endogeneity; budget deficit; economic growth; export-oriented industrialisation;
    All these keywords.

    JEL classification:

    • C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
    • C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions; Probabilities
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eei:journl:v:64:y:2021:i:1:p:1-22. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Julia van Hove (email available below). General contact details of provider: https://edirc.repec.org/data/eeriibe.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.