Exploring the Role of Fiscal Policy and Sovereign Debt Shocks on Economic Growth among Southern African Developing Communities
type: CreativeWork
description: Fiscal policy remains a key macroeconomic stabilisation mechanism at the disposal of governments and fiscal policymakers to influence economic activities consistent with balanced and sustainable economic growth. A thorough understanding of the role fiscal policy remains extremely paramount for fiscal authorities to consistently formulate prudent fiscal stimulus packages that enhances sustainable economic expansion. This thesis critically examines the role of fiscal policy and sovereign debt shocks on economic growth in the Southern African Developing Communities (SADC). Over the years, fiscal policy and austerity measures have triggered a deterioration in the fiscal position of these member countries primarily due to the relatively high budget deficits, inducing even further sovereign debt risk in long-term economic prosperity. The phenomenon of fiscal policy has gained immense scholarly popularity among both researchers and policymakers, stimulating intensive debate in the body of literature as to whether fiscal policy has been able stabilise macroeconomic fluctuations across different economies characterised by different phases of economic growth and development. The study starts by giving a thorough background and introduction in Chapter 1. Chapter 2 discusses a detailed review of existing theoretical frameworks on the role of fiscal policy and sovereign debt on economic growth. Chapter 3 analyses the role of fiscal policy and sovereign debt shocks on economic growth in the SADC region. In this chapter, a Panel Vector Autoregressive (PVAR) model was estimated using annual data for 13 SADC countries ranging from 2000-2018. The empirical results revealed that government expenditure, employment and public debt has a significant positive influence on economic growth while gross fixed capital formation exerts a negative effect on growth. The findings of the study are consistent with the Keynesian school of thought, which strongly argues that governments use countercyc…
abstract: Fiscal policy remains a key macroeconomic stabilisation mechanism at the disposal of governments and fiscal policymakers to influence economic activities consistent with balanced and sustainable economic growth. A thorough understanding of the role fiscal policy remains extremely paramount for fiscal authorities to consistently formulate prudent fiscal stimulus packages that enhances sustainable economic expansion. This thesis critically examines the role of fiscal policy and sovereign debt shocks on economic growth in the Southern African Developing Communities (SADC). Over the years, fiscal policy and austerity measures have triggered a deterioration in the fiscal position of these member countries primarily due to the relatively high budget deficits, inducing even further sovereign debt risk in long-term economic prosperity. The phenomenon of fiscal policy has gained immense scholarly popularity among both researchers and policymakers, stimulating intensive debate in the body of literature as to whether fiscal policy has been able stabilise macroeconomic fluctuations across different economies characterised by different phases of economic growth and development. The study starts by giving a thorough background and introduction in Chapter 1. Chapter 2 discusses a detailed review of existing theoretical frameworks on the role of fiscal policy and sovereign debt on economic growth. Chapter 3 analyses the role of fiscal policy and sovereign debt shocks on economic growth in the SADC region. In this chapter, a Panel Vector Autoregressive (PVAR) model was estimated using annual data for 13 SADC countries ranging from 2000-2018. The empirical results revealed that government expenditure, employment and public debt has a significant positive influence on economic growth while gross fixed capital formation exerts a negative effect on growth. The findings of the study are consistent with the Keynesian school of thought, which strongly argues that governments use countercyc…
author: Makhoba, Bongumusa Prince
license: https://devspace.unizulu.ac.za/bitstreams/ad652c3d-c7a2-420b-9783-7a14841418f7/download
date published: 2021
date modified: 2026-07-24T06:16:53Z
provider: University of Zululand
publisher: Networked Digital Library of Theses and Dissertations
type: WebPage
source organization: University of Zululand