The nexus between output fluctuations and fiscal deficits: empirical evidence on Ghana

Rosemond Mahu Augustt, George Adu and Prince Frimpong ()

International Journal of Sustainable Economy, 2015, vol. 7, issue 2, 100-117

Abstract: Ghana is presently confronted with persistent budget deficits and burgeoning public debt in excess of 52% of GDP and frequent fluctuations in total output below its long-run trend. This is of great concern which has issues for the country's long term growth and debt sustainability. Though the persistent deficit is a common knowledge, the driving force behind the deficit has remained quite elusive. The paper sets out to find the causal relationship between the recurrent budget deficit and output fluctuations in Ghana. With cyclical component of annual real GDP and fiscal deficit to GDP ratio time series data from 1960-2012, and subject to various econometric techniques and three estimation methods (OLS, SUR and VAR), the paper finds a bi-directional causal relationship between fluctuations in output and fiscal deficits to GDP ratio.

Keywords: output fluctuations; fiscal deficits; Ghana; budget deficits; public debt; long term growth; debt sustainability; econometrics. (search for similar items in EconPapers)
Date: 2015
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.inderscience.com/link.php?id=68676 (text/html)
Access to full text is restricted to subscribers.

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:ids:ijsuse:v:7:y:2015:i:2:p:100-117

Access Statistics for this article

More articles in International Journal of Sustainable Economy from Inderscience Enterprises Ltd
Bibliographic data for series maintained by Sarah Parker ().