| dc.description.abstract | This study examines the relationship between fiscal deficits and unemployment in Uganda from 1984 to 2023, with specific objectives to assess the impact of tax revenue, government expenditure, public debt, and inflation on unemployment. Grounded in Keynesian economics, the research utilizes regression analysis, supported by diagnostic tests such as stationarity checks, autocorrelation tests, and coefficient stability assessments, to ensure robust and reliable findings.
The analysis reveals that tax revenue and government expenditure significantly reduce unemployment, highlighting the importance of efficient tax systems and targeted public spending. Conversely, public debt exhibits a positive relationship with unemployment, emphasizing the risks of excessive borrowing that crowds out private-sector investment. Inflation demonstrates a marginally negative relationship with unemployment suggesting that moderate inflation can stimulate economic activity and reduce joblessness.
Data from reputable government reports and international financial institutions are analyzed within Uganda’s fiscal history, disaggregated across policy periods, including the structural adjustment era, the post-liberalization phase, and the COVID-19 recovery period. The findings inform actionable recommendations, such as improving tax administration, prioritizing productive government spending, adopting prudent debt management strategies, and maintaining moderate inflation through coordinated fiscal and monetary policies.
While the study highlights the critical role of fiscal policy in shaping labor market outcomes, it acknowledges limitations, including the exclusion of informal employment and the use of annual data. Future research should explore sector-specific impacts, gender and youth dimensions, and comparative studies across Sub-Saharan Africa. By addressing these gaps, the findings contribute to Uganda’s sustainable development goals, particularly Goal 8 on decent work and economic growth.
Key Words: Fiscal deficits, Unemployment, Tax revenue, Government expenditure, Public debt, Inflation, Keynesian theory, Uganda Sustainable Development, Labor market | en_US |
