Fiscal Policy and Growth: An Empirical Evaluation in CFA Franc Zone

Mondjeli Mwa Ndjokou
2013 International Business Research  
This paper evaluates the link between fiscal policy and growth. For this purpose, we evaluate the influence of the level of public expenditures and revenues as well as the composition of the budget on economic growth. Relying on data provided by African Development Indicators, our sample is made of 9 countries of the CFA Franc Zone over the period 1990-2010. Focusing on panel data techniques, our analysis leads to the following results: (i) public expenditures reduce significantly growth; (ii)
more » ... n increase in revenues is associated with positive GDP per capita growth even though the relation is not statistically significant; (iii) the composition of the budget matter on economic growth process especially indirect taxes (which enhance GDP per capita growth) and wages and salaries (which harmful growth).
doi:10.5539/ibr.v6n7p131 fatcat:bkrb3kpdnngx7enhzf2ovq2bvy