Record Details

Threshold effects of fiscal policy on economic growth in developing countries

Journal of Economic & Financial Studies

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Field Value
 
Title Threshold effects of fiscal policy on economic growth in developing countries
 
Creator Salma, Slimani
Idriss, El Abbassi
Said, Tounsi
 
Subject —
Developing countries; Economic growth; Fiscal deficit; Investment; Threshold effects.
H62, O49.
 
Description We examine the relation between fiscal policy and economic growth for a panel of 40 developing countries over the period of 1990 to 2012 using eight macroeconomic variables: real GDP, budget deficit, current government spending, national saving, inflation rate, total investment, public debt, and current account balance. The study documents a double threshold effect of the fiscal balance. The first one is at a level of the deficit around 4.8% of GDP; the second one is at the fiscal surplus level of 3.2% of GDP meaning that economic growth would be negatively affected when exceeding these two different levels. Result also show that the sign of the relation between budget deficit and economic growth is conditioned by the level of total investment i.e. only for total investment higher than 23%, there exists a positive relation. However, it becomes negative, when investment falls below this threshold.
 
Publisher LAR Center Press
 
Contributor —
 
Date 2016-07-14
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://journalofeconomics.org/index.php/site/article/view/225
10.18533/jefs.v4i3.225
 
Source Journal of Economic & Financial Studies; Vol 4, No 03 (2016): June; 24-37
2379-9471
2379-9463
 
Language eng
 
Relation http://journalofeconomics.org/index.php/site/article/view/225/290
 
Rights Copyright (c) 2016 SLIMANI Salma, EL ABBASSI Idriss, TOUNSI Said
http://creativecommons.org/licenses/by/4.0