EconPapers    
Economics at your fingertips  
 

Fiscal Sustainability and Interdependence of Primary Balance and Public Debt in South Africa

Elvis Munyaradzi Ganyaupfu () and Zurika Robinson
Additional contact information
Elvis Munyaradzi Ganyaupfu: University of South Africa

Acta Universitatis Danubius. OEconomica, 2019, issue 15(3), 318-334

Abstract: The main goal of this study was to evaluate sustainability of fiscal policy in South Africa, and assess the interdependence of primary balance and public debt, as ratios of gross domestic product, over the sample period 1997q4 to 2016q2. The Vector Error Correction (VEC) model was applied to estimate the fiscal reaction function using EViews program, while the VEC Granger-Causality/Block Exogeneity Wald test, impulse response functions and variance decompositions were applied to test for presence of interdependence between primary balance and public debt. Empirical results show strong evidence of consistency of government fiscal policy with the intertemporal budget constraint and interdependence between primary balance and public debt over the period under review. In implementing corrective fiscal adjustment measures to ensure fiscal sustainability, government should therefore consistently take into consideration the interdependency between primary fiscal balance and public debt profiles.

Keywords: fiscal policy; sustainability; interdependency; primary balance; public debt (search for similar items in EconPapers)
Date: 2019
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://journals.univ-danubius.ro/index.php/oeconomica/article/view/5326/4958 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:dug:actaec:y:2019:i:3:p:318-334

Access Statistics for this article

More articles in Acta Universitatis Danubius. OEconomica from Danubius University of Galati Contact information at EDIRC.
Bibliographic data for series maintained by Daniela Robu ().

 
Page updated 2025-03-19
Handle: RePEc:dug:actaec:y:2019:i:3:p:318-334