Analysis of government expenditure in driving economic growth in Zimbabwe between 1980 and 1998
Date
2011-11-10
Authors
Shumba, Jabusile Madyazvimbishi
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Abstract
Since 1980, the Zimbabwean economy has not performed well, characterised by averagely
declining levels of growth and often recording negative economic growth in some years. Various
explanations have been provided by different scholars including statism (Midgely, 1987; Gilman,
2006), excessive government spending (Fan and Rao, 2003), poor economic governance and a
series of ‘wrong’ policy choices (Gilpin, 2008). This research attempted to analyse the role of
public spending in driving economic growth over the period. The study focused on determining
the resource allocation to the three sectors of the economy (safety and security, social and
economic), identifying and classifying some programmes and projects implemented by
government according to the sectoral criteria of safety and security, social and economic, as well
as analysing the nature of the spending between operational and capital investment over the
period 1980 to 1998. The chosen data was collected and analysed from secondary sources mainly
budget statements, Government of Zimbabwe Socio-Economic Review documents and macroeconomic
policies. The study found that declining capital investment, increasing recurrent
expenditures, largely dominated by huge defence budget and transfer payments, were among
factors that reduced the influence of government expenditure in driving economic growth in
Zimbabwe. Key recommendations were drawn for Zimbabwe to institute budgetary reforms by
reducing large defence spending and size of the public sector, and direct limited fiscal resources
towards the economic sector through capital investment, human capital development and
knowledge processes as the imperatives for sustainable long-term growth
Description
MM thesis - P&DM
Keywords
Economic growth, Zimbabwe, Government expenditure, Zimbabwe