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Fiscal policy, employment, and output in South Africa: An open economy analysis

Journal of Economic & Financial Studies

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Field Value
 
Title Fiscal policy, employment, and output in South Africa: An open economy analysis
 
Creator Mlilo, Mthokozisi
Kollamparambi, Umakrishnan
 
Subject Economics
Employment; Fiscal policy shocks, South Africa; VAR.
O11, E2, H50, E62.
 
Description We provide strong evidence of a positive shock to government spending on increase in employment (public and private), an appreciation of the real effective exchange rate and deterioration in the trade balance; but it has no effect on output for South Africa during the period 1994:1-2008:4. We also document that positive shocks to net taxes generate an increase in output, private employment and have no effect on public employment; it also leads to a depreciation of the real effective exchange rate and an improvement in the trade balance. An important finding in this study is that the transmission channel between government expenditures and output is not as direct as suggested in the Keynesian doctrine, but is indirectly shown by public employment’s effects on output. We conclude that classical effects are predominant in the South African economy, i.e., only improvements in the supply-side components can be linked to increases in output.
 
Publisher LAR Center Press
 
Contributor —
 
Date 2016-07-11
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://journalofeconomics.org/index.php/site/article/view/238
10.18533/jefs.v4i3.238
 
Source Journal of Economic & Financial Studies; Vol 4, No 03 (2016): June; 11-23
2379-9471
2379-9463
 
Language eng
 
Relation http://journalofeconomics.org/index.php/site/article/view/238/288
 
Rights Copyright (c) 2016 mthokozisi mlilo
http://creativecommons.org/licenses/by/4.0