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Do Fiscal Regimes Matter for Fiscal Sustainability in South Africa? A Markov-Switching Approach

Gabriel Temesgen Woldu

Applied Economics Quarterly2022https://doi.org/10.3790/aeq.68.1.53article
ABDC B
Weight
0.38

What the paper says

This paper empirically examines South Africa’s fiscal sustainability through a Markov-switching model which utilizes quarterly datasets for the period from 1960 to 2019. The results show that public debt responds positively, demonstrating a sustainable fiscal policy. Furthermore, considering the regime-specific feedback coefficients of the fiscal policy rule and the durations of fiscal regimes, the study finds that South Africa’s fiscal policy satisfies the No-Ponzi game condition. Therefore, from a policy perspective, the South African government should take measures such as pension reforms, reducing operational expenses, reducing subsidies, and funding micro and small enterprises to gain the double dividend on the expenditure side along with revenue-enhancing measures on consumption taxes to achieve stable public finances and lower debt levels.

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https://doi.org/https://doi.org/10.3790/aeq.68.1.53

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@article{gabriel2022,
  title        = {{Do Fiscal Regimes Matter for Fiscal Sustainability in South Africa? A Markov-Switching Approach}},
  author       = {Gabriel Temesgen Woldu},
  journal      = {Applied Economics Quarterly},
  year         = {2022},
  doi          = {https://doi.org/https://doi.org/10.3790/aeq.68.1.53},
}

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Do Fiscal Regimes Matter for Fiscal Sustainability in South Africa? A Markov-Switching Approach

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Evidence weight

0.38

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.08 × 0.4 = 0.03
M · momentum0.80 × 0.15 = 0.12
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.