Revenue and expenditure nexus: A case study of ECOWAS

Cosimo Magazzino

No 2012-57, Economics Discussion Papers from Kiel Institute for the World Economy (IfW Kiel)

Abstract: This paper aims to assess the relationship among fiscal variables (net lending, government expenditure and revenue) and economic growth in Sub-Saharan African countries. Using yearly data for the period between 1980 and 2011 in 15 ECOWAS countries, a weak long-run relationship between government expenditure and revenue emerge, but only in the case of WAMZ countries. Granger causality analysis showed mixed results for WAEMU countries, while for four out of six WAMZ countries (Gambia, Liberia, Nigeria, and Sierra Leone) the tax-and-spend hypothesis holds, since government revenue would drive the expenditure. Finally, in the last three decades, cyclical component of economic growth has reduced its fluctuations, both for WAEMU and WAMZ member States.

Keywords: ECOWAS; Sub-Saharan Africa; economic growth; government expenditure; government revenue; panel (search for similar items in EconPapers)
JEL-codes: B22 C33 E62 F33 (search for similar items in EconPapers)
Date: 2012
New Economics Papers: this item is included in nep-afr, nep-mac and nep-pbe
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https://www.econstor.eu/bitstream/10419/66141/1/729496937.pdf (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwedp:201257

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