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Testing of the Ricardian Equivalence proposition: An Empirical Examination for Malaysia (1962-2006)
Gadjah Mada International Journal of Business
View Archive Info| Field | Value | |
| Title |
Testing of the Ricardian Equivalence proposition: An Empirical Examination for Malaysia (1962-2006)
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| Creator |
Ismail, Ismadi
Ismail, Abdul Ghafar Amiruddin, Rosilawati |
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| Subject |
debts; Ricardian equivalence; VAR; VECM
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| Description |
This paper investigates the effects of debts and budgetary deficit on real variables using structural Vector Error Correction Model (VECM) method with long-run restrictions. We compare our estimates of the impulse responses with those based on levels Vector Auto-Regressive (VAR) with standard recursive order restrictions. The test is conducted on the Malaysian data covering the period of 1962-2006. The empirical results do not support the existence of “Ricardian Equivalence” hypothesis. The effects of budgetary deficit and government spending have a significant influence on private consumption and private investment.
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| Publisher |
Master of Management, Faculty of Economics and Business, Universitas Gadjah Mada
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| Date |
2008-06-12
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| Type |
info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion Peer-reviewed Article |
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| Format |
application/pdf
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| Identifier |
http://journal.ugm.ac.id/gamaijb/article/view/5571
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| Source |
Gadjah Mada International Journal of Business; Vol 10, No 2 (2008): May - August
2338-7238 1411-1128 |
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| Language |
eng
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| Relation |
http://journal.ugm.ac.id/gamaijb/article/view/5571/4542
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