scholarly journals Fiscal Deficit and its effects on economic growth

2021 ◽  
Vol 10 (1) ◽  
pp. 62-70
Author(s):  
Nexhat H. Kryeziu ◽  
Egzon Hoxha
Keyword(s):  
Economic Growth ◽  
Serial Correlation ◽  
Positive Impact ◽  
Multiple Linear Regression Model ◽  
Positive Sign ◽  
Gdp Growth ◽  
Fiscal Deficit ◽  
Least Squares Regression ◽  
Growth Ratio ◽  
The Impact

The main purpose of this paper is to assess the impact of the deficit on GDP growth for the Eurozone area, using panel data for a period from 1995 to 2015, with a total of 257 observations. In order to conduct the study and come up with results, we have used a multiple linear regression model with the least-squares regression. Consequently, in order to test the data used in the model, we have applied diagnostic tests, such as the Durbin-Watson test to analyze the correlation of serial correlation, as well as the Breusch-Pagan test for heteroskedasticity. The test results prove that there is no heteroskedasticity and at the same time there are strong indications that the model has no relation between serial correlation. The results presented in our study show that the variables, deficit ratio to GDP, is statistically significant with a positive sign and as a result, we have the growth of the deficit ratio with GDP having a positive impact on the economic growth ratio. Keywords: Fiscal deficit, GDP Growth Rate, Correlation, Regression

scholarly journals The Impact of Inflation on Economic Growth

2019 ◽  
Vol 8 (1) ◽  
pp. 01-09
Author(s):  
Nexhat Kryeziu ◽  
Esat Ali Durguti
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
Linear Regression ◽  
Multiple Linear Regression ◽  
Serial Correlation ◽  
Inflation Rate ◽  
Positive Impact ◽  
Linear Regression Analysis ◽  
Multiple Linear Regression Model ◽  
The Impact

The main purpose of this study is to investigate inflation rate and its impact on the growth rate or to GDP growth for Eurozone countries, using panel data for the period 1997-2017, on an annual basis with a total of 257 observations. For conducting the study, and achieving results, a multiple linear regression model with the least squares regression is used. Moreover, multiple linear regression analysis has been applied in order to investigate whether Inflation rate, as an independent variable, has any significant impact on economic growth. Consequently, in order to test the data used in the model we have applied diagnostic tests, such as Durbin-Watson test to analyze the correlation of serial correlation, as well as the Breusch-Pagan test for heteroskedasticity. The tests’ results give us strong indications that the model has no relation between of serial correlation and there is no heteroskedasticity either. The study conducted shows results generated from the model, and according to the econometric results indicate that Inflation rate has positive impact on the economic growth rate for euro area.

scholarly journals Causal nexus between fiscal deficit and economic growth

2016 ◽  
Vol 4 (8) ◽  
pp. 1-19
Author(s):  
Ravinthirakumaran Navaratnam ◽  
Kasavarajah Mayandy
Keyword(s):  
Economic Growth ◽  
Sri Lanka ◽  
South Asian ◽  
Negative Impact ◽  
Positive Impact ◽  
Cointegration Analysis ◽  
Annual Data ◽  
Fiscal Deficit ◽  
Asian Countries ◽  
The Impact

The impact of fiscal deficit on economic growth is one of the most widely debated issues among economists and policy makers in both developed and developing countries in the recent period. This paper seeks to examine the impact of fiscal deficit on economic growth in selected South Asian countries, namely, Bangladesh, India, Nepal, Pakistan and Sri Lanka using time series annual data over the period 1980 to 2014. The paper uses cointegration analysis, error correction modelling and Granger causality test under a Vector Autoregression (VAR) framework. The results from this study confirmed that the fiscal deficit has a negative impact on economic growth in the South Asian countries considered in this study except Nepal, which confirmed the positive impact. The results also highlighted that the direction of causality for the SAARC countries is mixed where fiscal deficit causes economic growth for Bangladesh, Nepal and Pakistan, but the reverse is true for India and Sri Lanka.  

scholarly journals Impact of Money Supply on Sri Lankan Economy: An Econometric Analysis

2016 ◽  
Vol 67 ◽  
pp. 11-17 ◽  
Author(s):  
A.L.M. Aslam
Keyword(s):  
Economic Growth ◽  
Sri Lanka ◽  
Money Supply ◽  
Serial Correlation ◽  
Positive Impact ◽  
Series Data ◽  
Sri Lankan ◽  
Independent Variables ◽  
Lm Test ◽  
The Impact

Economists argue that the money supply positively impact on economic growth of nations. In Sri Lankan context this statement was not tested econometrically. Therefore, the aim of this study was to scrutinize the impact of money supply on Sri Lankan economy. To exam this objective, this study considered the time series data from the period of 1959 to 2013 and used two types of variables such as dependent and independent variables. Here, the gross domestic product was considered as dependent variable, and Money supply, Exchange rate, Exports earnings, Imports outflow, the Colombo consumer price index were deemed as independent variables. In the meantime, the multivariate econometric method was used to test the impacts of money supply on economic growth of Sri Lanka. According to the analytical results, the money supply has kept positive impact on the economic growth of Sri Lanka at 1% significant level. The R-squared of the estimated model was 92% which was indicated that the estimated model was desirable. Meanwhile, the Durbin Watson test statistic was 2.43 and also the Breusch –Godfrey serial correlation LM test results was greater than 5%. Therefore, these statistics indicated that, the estimated model was not suffering from serial correlation.

scholarly journals Impact of FDI Inflow on Average Wage and Employment in Serbia

2019 ◽  
Author(s):  
Milica Perić
Keyword(s):  
Economic Growth ◽  
Positive Impact ◽  
Research Question ◽  
Multiple Linear Regression Model ◽  
Time Lags ◽  
Average Wage ◽  
Developed Economies ◽  
Economic Growth Rates ◽  
Dissemination Of Technology ◽  
The Impact

Research question: This research comes to examine the impact of FDI inflow on average wage and on employment in Serbia in the period 2005-2017. Motivation: FDI tendentiously increases the economic growth rates, taking into consideration the fact that developed economies benefit from FDI because their local institutions are more productive, while developing countries benefit from “pieces“ of FDI, i.e., dissemination of technology and rarely evoke some relevant progress in economic growth. Despite the growing research in the FDI field, the scientific literature on average wage and employment in relation to FDI Inflow in Serbia is limited, which is the motivation to conduct this research. Idea: Therefore, the aim of this research is to estimate the relationship between FDI Inflow and average wage and employment. Data: The data are obtained from the official sites of the National Bank of Serbia and from the Statistical Office of Serbia. Tools: The methodology used is the multiple Linear Regression Model, applying the IBM SPSS software, in order to identify the impact of FDI Inflow on average wage and on employment using time lags. Findings: The results prove the absence of significant impact of FDI inflow on average wage and on employment within the country. The highest positive impact of FDI inflow appears to be in the year the inflow occurs for average wage, and in the second year of FDI inflow performance for employment. Contribution: This paper contributes to the awareness of low impact of FDI inflow on average wage and on employment in Serbia. Moreover, this research covers the gap in the literature in the field of FDI inflow in relation to average wage and employment within the country

scholarly journals Analysis of the Impact of Exchange Rate, Inflation, Export and Import on Gross Domestic Product in Bangladesh

2019 ◽  
pp. 170-175
Author(s):  
Papi Halder
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
Exchange Rate ◽  
Gross Domestic Product ◽  
Positive Impact ◽  
Domestic Product ◽  
Gdp Growth ◽  
Policy Makers ◽  
Gdp Growth Rate ◽  
The Impact

This study is about the impact of selected macroeconomic variables on economic growth of Bangladesh. Economic growth of Bangladesh is measured in terms of annual nominal GDP growth rate. Least squared regression model has been employed considering exchange rate, export, import and inflation rate as independent variables and gross domestic product as the dependent variable in this study. The results reveal that export and import have significant positive impact on GDP growth rate. The other variables (exchange rate and inflation) are not significant, indicating that there exists no significant relationship among the variables. The findings will help the policy makers to make policies concerning the country’s economic growth to remain robust in the near future.

Is Fiscal Deficit Essential for Stimulating Economic Growth in Developing Economies? Theory and Empirical Evidence from India

2021 ◽  
Keyword(s):  
Economic Growth ◽  
Developing Economies ◽  
Negative Impact ◽  
Gdp Growth ◽  
Fiscal Deficit ◽  
Causality Test ◽  
Long Run ◽  
Integration Test ◽  
The Government ◽  
The Impact

The primary purpose of this paper was to assess the impact of fiscal deficit on the economic growth of the Indian economy and find out the causality between fiscal deficit and economic growth from 1981-82 to 2019-20. To analyse the long-run relationship between the variables Johansen Co-integration test was used; after verifying the existence of long-run relationship among variables, the Vector Error Correction Model (VECM) was used, and the Granger Causality test was also used for investigating the direction of causality between pair of variables. The findings of the study supported the ideology of classical economists in which they neglected the government intervention for the growth and development of an economy. The results showed that in long run, fiscal deficit had a significant negative impact on economic growth as one percent increase in fiscal deficit demoted the GDP growth rate by 0.075 percent, whereas in the short run, the impact was also found negative, but it was significant only one lag. Simultaneously, there was unidirectional causality found from fiscal deficit to GDP growth.

scholarly journals The Impact of Foreign Aid on Economic Growth in Ethiopia

2012 ◽  
Vol 13 (2) ◽  
pp. 87-112
Author(s):  
Mohammed Seid Hussen ◽  
Kye Woo Lee
Keyword(s):  
Economic Growth ◽  
Foreign Aid ◽  
Positive Impact ◽  
Aid Effectiveness ◽  
Gdp Growth ◽  
Domestic Investment ◽  
Per Capita Gdp ◽  
Democratic Regimes ◽  
Per Capita ◽  
The Impact

This paper investigates the impact of foreign aid on investment and economic growth of Ethiopia for the period 1971-2010. The result indicates that foreign aid has a statistically significant positive impact on domestic investment, while aid’s positive impact on per capita GDP growth does not depend on any macroeconomic policy conditionality. Rather, aid effectiveness depends on the peculiar social, political and economic institutions of particular periods. Aid is effective during both socialist and democratic regimes. However, aid’s impact on growth was greater for socialist regimes.

scholarly journals THE IMPACT OF SECURITIES MARKETS ON ECONOMIC GROWTH IN ZIMBABWE

2020 ◽  
Vol 7 (3) ◽  
pp. 155-169
Author(s):  
Wilford Mawanza ◽  
Nkululeko Mpofu ◽  
Silethemba Nyoni
Keyword(s):  
Economic Growth ◽  
Positive Impact ◽  
Ordinary Least Squares ◽  
Securities Markets ◽  
Least Squares Regression ◽  
Likelihood Estimator ◽  
Main Method ◽  
Endogenous Growth Model ◽  
Market Capitalisation ◽  
The Impact

The paper examines the impact of securities exchange on economic growth in Zimbabwe for the period 1980 to 2017. The study adopted the endogenous growth model on which magnitude and fluidity of securities were deemed to be the main drivers of the economy. The ordinary least squares regression technique was applied as the main method of analysis and as the maximum likelihood estimator. The findings of the study showed that securities exchange has blended impacts on economic expansion. It was observed that the market size (market capitalisation) and foreign direct investment (FDI) have a significant positive impact on the economic growth.

scholarly journals The Impact of Government Expenditures on Economic Growth in Jordan (1980-2013)

2015 ◽  
Vol 9 (1) ◽  
pp. 99 ◽  
Author(s):  
Torki M. Al-Fawwaz
Keyword(s):  
Economic Growth ◽  
Positive Impact ◽  
Government Expenditure ◽  
Multiple Linear Regression Model ◽  
Government Expenditures ◽  
Economic Activities ◽  
Economic Sectors ◽  
Keynesian Model ◽  
The Impact ◽  
The Empirical Analysis

<p class="FreeForm">The purpose of this study is to measure the impact of government expenditures on economic growth in Jordan during the period between 1980-2013. To achieve the goal of this study, the multiple linear regression model, linking the study variables was used. Then, the model was analyzed using the OLS model. The results indicate that there is a positive impact for both total government expenditure and current government expenditure on economic growth. This result supports the Keynesian model. Based on the findings of the empirical analysis, the study recommends that capital government expenditure should be directed mainly to current productive economic activities in order to stimulate activities in the economic sectors.</p>

scholarly journals The Impact of Public Expenditure Structure on Economic Growth in Russia

2018 ◽  
Vol 13 (6) ◽  
pp. 8-35
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
National Economy ◽  
Positive Impact ◽  
Empirical Studies ◽  
Social Spending ◽  
Gdp Growth ◽  
Gdp Growth Rate ◽  
General Government ◽  
The Impact

In this paper we estimate the impact of changes in the structure of general government expenditure on GDP growth rate in Russia. We construct two types of models: with expenses as shares of total general government spending and as percentages of GDP. The structural vector autoregression (SVAR) methodology from [Corsetti et al., 2012] has been used. According to our estimates, an increase in the share of productive expenditures (national economy, education and health) has a positive impact on the rate of economic growth, while an increase of the share of non-productive expenditures (national defense and social policy) has a negative effect on the growth rate of GDP. The largest positive effect among productive expenditures belongs to expenditure on the national economy: increasing spending on the national economy by 1% of GDP while maintaining the total expenditure unchanged leads to an increase in GDP growth rate by 1.1 p.p. The second largest effect is produced by expenditure on education: a 1% of GDP increase in this expenditure with constant total spending leads to additional GDP growth of 0.8 p.p. Expenditure on health care has the least positive impact on growth: the effect of its increase is estimated at +0.1 p.p. to GDP growth rate. For defense and social spending the effect is negative: -2.1 p.p. and -0.7 p.p. respectively. The results obtained in this paper are generally consistent with the results in previous empirical studies for Russia based on fiscal multipliers, as well as results in empirical studies with foreign and international data.

Sign in / Sign up

Export Citation Format

Share Document