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How sustainable are fiscal budgets in the Kingdom of Swaziland?

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  • Phiri, Andrew

Abstract

The recently experienced Swazi fiscal crisis of 2011 has facilitated the need for an academic probe into the sustainability of fiscal budgets in the Kingdom. Against the absence of empirical evidence evaluating the sustainability of Swazi fiscal budget, our study fills the hiatus by econometrically evaluating the sustainability of the fiscal budget of the Swazi economy between 1999 and 2016. Our empirical study depends on a combination of linear and asymmetric unit root and cointegration empirical procedures to attain this objective. In reviewing the obtained results, the evidence obtained from the linear econometric frameworks is inconclusive whereas the results from the more vigorous asymmetric models point to the unsustainability of Swazi fiscal budget over both the short and long-run. Important policy implications for Swazi fiscal policymakers are drawn from the analysis.

Suggested Citation

  • Phiri, Andrew, 2018. "How sustainable are fiscal budgets in the Kingdom of Swaziland?," MPRA Paper 85149, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:85149
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    More about this item

    Keywords

    Fiscal budget; Fiscal Crisis; Swaziland; SACU; KSS nonlinear unit root test; Fourier function; nonlinear autoregressive distributive lag model.;
    All these keywords.

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
    • H61 - Public Economics - - National Budget, Deficit, and Debt - - - Budget; Budget Systems
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus

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