The impact of economic policy shocks on the outcomes of the fiscal adjustment policies in Tanzania

Arnold Mathias Kihaule

MPRA Paper from University Library of Munich, Germany

Abstract: This paper examines the outcomes of the fiscal adjustment policies adopted during the period in which Tanzania experienced economic shocks. The econometric models are used to determine the impact of exogenous and economic policy shocks on gdp growth, public spending and the fiscal balance. The results revealed that policy shocks resulted in structural changes in output growth and public spending instability in Tanzania. Specifically, economic policy shocks led to changes in macroeconomic conditions, which adversely affected the fiscal position after 1986. The results suggest that fiscal adjustment policies should not be undertaken when a number of economic policy changes are envisaged in an economy.

Keywords: fiscal adjustment policies; fiscal deficit; public spending; economic policy shock; Tanzania (search for similar items in EconPapers)
JEL-codes: E62 (search for similar items in EconPapers)
Date: 2012-12, Revised 2013-02
New Economics Papers: this item is included in nep-afr and nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:46151

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