Analysis of Trend and Sources of Government Budget Deficit Financing in Bangladesh

Colin, R

doi:10.32890/jis2020.16.8

Cited by 5 publications

(4 citation statements)

References 15 publications

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“…In addition, money supply, national debt, and international trade also significantly impacted the short and long term fiscal deficit. Sadekin et al (2020), using trend analysis for Bangladesh, found that government financing is a significant determinant of fiscal deficit. Alam et al (2020), using a VECM approach, found that inflation, exchange rate, trade, and money supply had a negative effect on fiscal deficit in the short run but a positive association in the long run.…”

Section: Empirical Literaturementioning

confidence: 99%

The Determinants of Fiscal Deficit in South Africa: A Bayesian Vector Autoregressive Approach

Kasongo

2023

IJEFI

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This study empirically investigates the factors influencing South Africa's fiscal deficit from 1975 to 2021. The research design used the Bayesian vector autoregressive estimation with the Minestor prior. The findings are analysed using the impulse response function and variance decomposition. The findings revealed that government debt, GDP growth, money supply, and interest rate as determinants of the fiscal deficit. Impulse response functions showed positive and significant impacts of government debt on the fiscal deficit; negative and significant impacts of economic growth, money supply, and interest rate on fiscal deficits. The variance decomposition showed that economic growth and national debt explained the variations in fiscal deficit in the long run. The relationship between macroeconomic factors and fiscal deficit could have social consequences for the even distribution of resources, equitable growth, and overall welfare. This study contributes to the limited literature on the macroeconomic determinants of fiscal deficit in the South African economy and Africa at large.

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Section: Empirical Literaturementioning

confidence: 99%

The Determinants of Fiscal Deficit in South Africa: A Bayesian Vector Autoregressive Approach

Kasongo

2023

IJEFI

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“…External shocks, debt ratios, financial development, democracy, and government spending control are all strongly linked to fiscal deficits, according to the researchers' findings. Sadekin et al (2020) investigates the patterns and origins of Bangladesh's government budget deficit. The data was analysed using descriptive techniques.…”

Section: Literature Reviewmentioning

confidence: 99%

Determinants of Budget Deficit in Nigeria

Shehu

Adamu

2021

JIBE

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This paper investigates the factors governing the determination of budget deficit in Nigeria from 1981q1 through 2016q4. Our methodology is based on Johansen cointegration and Vector Error Correction model (VECM) approach. The result from the Johansen cointegration test suggests one cointegrating vector, which indicates the existence of a long run cointegrating relationship. Evidence from the long run and short run parameters suggest that exchange rate, interest rate and one year lag of budget deficit are the major determinants of budget deficit. Therefore, to achieve a realistic fiscal surplus, the government should determine a high level of accountability in its fiscal operations. In addition, any fiscal surplus should be channeled into productive investments to diversify the economy and reduce the likelihood of potential budget deficits.

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“…Many state-owned enterprises (SOEs) in developing and transition economies, including South Africa, are loss-making and inefficient, burdening government finances and scarce resources. Their poor financial performance affects service delivery and their ability to fulfill the government's growth and developmental objectives (Sadekin et al, 2020;Billio et al, 2021). The question dominating discussion is: How does the capital structure of South African SOEs affect their financial performance with and without government support?…”

Section: Introductionmentioning

confidence: 99%

The Determinants of Financial Performance of South African State-Owned Entities

MARIMUTHU,

MVUNABANDI,

MAAMA

2023

IJESSS

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Several state-owned enterprises (SOEs) have severally faced imminent collapse, resulting in various support from the government. This has increased the debt level of the government and the SOEs. The study examined the factors that influence the financial performance of South African SOEs. This study used a quantitative methodology and secondary data of 33 South African SOEs from 1995 to 2017. The data were analysed using a multiple regression model and the GMM estimation technique. The study's conclusions show a statistically significant inverse relationship between capital structure and financial performance. The evidence further showed that government intervention in financial assistance, such as grants, funds, rebates, and subsidies, has contributed to the poor performance of SOEs. The inverse association suggests that the SOEs performance continues to worsen despite government support, which is quite concerning. The results demonstrate that government support is not a sound choice for developing SOEs since it makes management more dependent on it to meet operational needs and seize expansion possibilities. Additionally, the increased use of debt stresses government finances due to the rise in government guarantees. The study concludes that, contrary to the agency theory, leverage does not enhance SOEs' performance, suggesting they should be careful when selecting their capital structure. Finally, the South African SOEs’ performance is being hampered by government support. The findings have several policy implications for the government and the management of SOEs.

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Analysis of Trend and Sources of Government Budget Deficit Financing in Bangladesh

Cited by 5 publications

References 15 publications

The Determinants of Fiscal Deficit in South Africa: A Bayesian Vector Autoregressive Approach

The Determinants of Fiscal Deficit in South Africa: A Bayesian Vector Autoregressive Approach

Determinants of Budget Deficit in Nigeria

The Determinants of Financial Performance of South African State-Owned Entities

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