<abstract xmlns="http://www.w3.org/1999/xhtml"><p>The paper aims at examining the causal relationship between economic growth and government expenditure in selected MENA countries over the period of 1987–2017. Unlike previous studies, we examine the causality in both panel data and time series data to get a clear idea about the causal relationships individually and as a full sample. We also revisited the causal relationship between the two variables within the framework of frequency domain causality. Our findings support the neutrality hypotheses in the short-run term for most of the countries. Thus, economic growth and government expenditure at most frequency levels evolve independently. On the other hand, we found the support of Wagner’s law, Keynes view, neutrality and bidirectional hypotheses in the long term.</p></abstract>

The paper aims at examining the causal relationship between economic growth and government expenditure in selected MENA countries over the period of 1987–2017. Unlike previous studies, we examine the causality in both panel data and time series data to get a clear idea about the causal relationships individually and as a full sample. We also revisited the causal relationship between the two variables within the framework of frequency domain causality. Our findings support the neutrality hypotheses in the short-run term for most of the countries. Thus, economic growth and government expenditure at most frequency levels evolve independently. On the other hand, we found the support of Wagner’s law, Keynes view, neutrality and bidirectional hypotheses in the long term.

Government Expenditure and Economic Growth Nexus in Mena Countries: Frequency Domain Spectral Causality Analysis

Economics and Business

This work is licensed under the Creative Commons Attribution 4.0 International License.

The paper aims at examining the causal relationship between economic growth and government expenditure in selected MENA countries over the period of 1987–2017....

Government Expenditure and Economic Growth Nexus in Mena Countries: Frequency Domain Spectral Causality Analysis

Published Online: Jun 08, 2020

Page range: 60 - 77

DOI: https://doi.org/10.2478/eb-2020-0005

Keywords
Economic growth, Government expenditure, Frequency domain spectral causality, Wagner’s law, MENA countries

© 2020 Hicham Ayad, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Government Expenditure and Economic Growth Nexus in Mena Countries: Frequency Domain Spectral Causality Analysis

Published Online: Jun 08, 2020

Page range: 60 - 77

DOI: https://doi.org/10.2478/eb-2020-0005

KeywordsEconomic growth, Government expenditure, Frequency domain spectral causality, Wagner’s law, MENA countries

© 2020 Hicham Ayad, published by Sciendo

This work is licensed under the Creative Commons Attribution 4.0 International License.

Keywords
Economic growth, Government expenditure, Frequency domain spectral causality, Wagner’s law, MENA countries