The Impact of Fiscal Policy on Economic Growth In The Southern Africa Region: A Spatial Econometric Approach

Abstract

This spatial analysis examines the relationship between fiscal policy and economic growth in the Southern African Development Community (SADC). Using econometric techniques on data from 2000-2017 across 12 member states, the study reveals that tax revenue negatively impacts the economic growth of neighbouring countries, highlighting harmful tax competition. It emphasises the need for coordinated regional tax policies to foster sustainable growth and manage public debt levels. The findings provide insights for SADC nations to enhance fiscal policy frameworks and promote regional cooperation for shared prosperity.

Keywords

• fiscal policy
• tax revenues
• government expenditures
• public debt
• economic growth
• spillover effects