<abstract xmlns="http://www.w3.org/1999/xhtml">

<bold>Research background:</bold> Public spending is a generator of economic growth as well as its components; this reality is more depicted in the era of the COVID-19 world pandemic where a recession in economic activities has touched all countries.
<bold>Purpose:</bold> In this paper, we tried to study the impact of shocks in public expenditure on some macroeconomic variables in Algeria during the period (1970–2019).
<bold>Research methodology:</bold> The VAR Structural models were used to study the response of these variables to shocks in public spending in Algeria.
<bold>Results:</bold> The results of the modeling indicate a direct response of both exports and imports to a shock in the levels of public expenditure, but this response is relatively weak to the variable value of exports (especially in the short term), which is mainly due to the structure of the Algerian economy that is mainly dependent on the export of oil and gas, which in turn is mainly affected by international energy factors e.g. prices, supply, and demand. For the rate of inflation, there was an inverse response to shocks in the level of public spending. In the context of the global health and economic crisis, we will witness a further faltering of economic growth in Algeria.
<bold>Novelty:</bold> Our contribution is a new feature of the application of the SVAR model in the era of the COVID-19 pandemic that focused on analyzing the impacts of public expenditure on exports and imports
</abstract>

Research background: Public spending is a generator of economic growth as well as its components; this reality is more depicted in the era of the COVID-19 world pandemic where a recession in economic activities has touched all countries.
Purpose: In this paper, we tried to study the impact of shocks in public expenditure on some macroeconomic variables in Algeria during the period (1970–2019).
Research methodology: The VAR Structural models were used to study the response of these variables to shocks in public spending in Algeria.
Results: The results of the modeling indicate a direct response of both exports and imports to a shock in the levels of public expenditure, but this response is relatively weak to the variable value of exports (especially in the short term), which is mainly due to the structure of the Algerian economy that is mainly dependent on the export of oil and gas, which in turn is mainly affected by international energy factors e.g. prices, supply, and demand. For the rate of inflation, there was an inverse response to shocks in the level of public spending. In the context of the global health and economic crisis, we will witness a further faltering of economic growth in Algeria.
Novelty: Our contribution is a new feature of the application of the SVAR model in the era of the COVID-19 pandemic that focused on analyzing the impacts of public expenditure on exports and imports

What Can SVAR Models Tell us About the Impact of Public Expenditure Shocks on Macroeconomic Variables in Algeria? A Slight Hint to the COVID-19 Pandemic

Lecturer A, Department of Based Education

Folia Oeconomica Stetinensia

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

Research background: Public spending is a generator of economic growth as well as its components; this reality is more depicted in the era of the COVID-19...

What Can SVAR Models Tell us About the Impact of Public Expenditure Shocks on Macroeconomic Variables in Algeria? A Slight Hint to the COVID-19 Pandemic

Published Online: Nov 26, 2021

Page range: 21 - 37

Received: Aug 07, 2021

Accepted: Oct 15, 2021

DOI: https://doi.org/10.2478/foli-2021-0014

Keywords
Public Expenditure, SVAR, COVID-19, Algeria

© 2021 Chellai Fatih, published by Sciendo

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

What Can SVAR Models Tell us About the Impact of Public Expenditure Shocks on Macroeconomic Variables in Algeria? A Slight Hint to the COVID-19 Pandemic

Published Online: Nov 26, 2021

Page range: 21 - 37

Received: Aug 07, 2021

Accepted: Oct 15, 2021

DOI: https://doi.org/10.2478/foli-2021-0014

KeywordsPublic Expenditure, SVAR, COVID-19, Algeria

© 2021 Chellai Fatih, published by Sciendo

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

Keywords
Public Expenditure, SVAR, COVID-19, Algeria