Casual analysis between government spending and gross domestic product in Zimbabwe (1960to2022)
- Author
- Mandimutsira, Terrence T.
- Title
- Casual analysis between government spending and gross domestic product in Zimbabwe (1960to2022)
- Abstract
- The research of analysis the causal relationship between government spending and Gross Domestic Product is based on debatable backbones that is the Keynesian hypothesis and the Wegner’s law. Keynesian hypothesis posits that government expenditure is stimulates Gross domestic product and Wagner’s Law posits that gross domestic product stimulates government spending. The study examined the causal relationship between the government spending and gross domestic product in Zimbabwe from 1960 to 2022 using data from World Bank. Employing the Granger causality test and the Autoregressive Distribution Lag, the Keynesian hypothesis was found in Zimbabwe. The results show that government spending has a significant positive impact on GDP. Additionally, there results shows that there is bidirectional causality between government spending and GDP, suggesting that economic growth also influences government expenditure. The research findings have significant implications for fiscal policy and economic development in Zimbabwe, highlighting the need for strategic government spending to promote sustainable economic growth
- Date
- June 2024
- Publisher
- BUSE
- Keywords
- Government spending
- Gross Domestic Product (GDP)
- Supervisor
- Dr. Damiyano
- Item sets
- Department of Economics
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