Cyclical Patterns of Government Expenditures in Sub-Saharan Africa: Facts and Factors

By Irene Yackovlev, Victor Duarte Lledo, Lucie Gadenne

December 1, 2009

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Irene Yackovlev, Victor Duarte Lledo, and Lucie Gadenne. Cyclical Patterns of Government Expenditures in Sub-Saharan Africa: Facts and Factors, (USA: International Monetary Fund, 2009) accessed November 23, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper documents cyclical patterns of government expenditures in sub-Saharan Africa since 1970 and explains variation between countries and over time. Controlling for endogeneity, it finds government expenditures to be slightly more procyclical in sub-Saharan Africa than in other developing countries and some evidence that procyclicality in Africa has declined in recent years after a period of sharp increase through the 1990s. Greater fiscal space, proxied by lower external debt, and better access to concessional financing, proxied by larger aid flows, seem to be important factors in diminishing procyclicality in the region. The role of institutions is less clear cut: changes in political institutions have no impact on procyclicality.

Subject: Expenditure, Fiscal policy, Fiscal space, Procyclicality, Public debt

Keywords: Central government, Cyclical fiscal policy, Fiscal policy objective, GDP growth, Government spending, Terms of trade, WP

Publication Details

Pages:

31
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2009/274
Stock No:

WPIEA2009274
ISBN:

9781451874198
ISSN:

1018-5941

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