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Title
Cyclical fiscal policy in developing countries: the case of Africa |
Full text
http://www.uq.edu.au/economics/mrg/2408.pdf |
Author(s)
Fabrizio Carmignani |
Abstract
The paper documents three pieces of empirical evidence on fiscal policy in Africa. First, a bigger government increases the volatility of output growth. Second, fiscal policy has substantially Keynesian effects. Third, fiscal policy instruments in Africa behave either pro-cyclically or a-cyclically, but practically never counter-cyclically. Taken together, these three findings imply that fiscal policy does not contribute to output stabilization. Quite the contrary, in several African countries fiscal policy is a source of volatility. Given the large development costs of volatility, ways to encourage the adoption of a counter-cyclical fiscal policy stance are then discussed. |
Type of publication
preprint |
Identifier
RePEc:qld:uqmrg6:24 |
Repository
RePEc - Research Papers in Economics
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Added to C-A: 2009-03-24;10:20:43 |
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