A Dynamic Analysis of the Impact of Fiscal Adjustment on Economic Growth
Evidence From Pakistan
Bibliographic Data
| ID | 4181772 |
|---|---|
| Authors | Ibrar Hussain (0000-0002-2956-450X, University of Malakand, corresponding author), Jawad Hussain (0000-0002-8885-0135, University of Malakand), Arshad Ali (0000-0002-7738-5776, University of Malakand), Shabir Ahmad (0000-0002-0523-6536, University of Malakand) |
| Year | 2021 |
| Volume | 11 |
| Issue | 2 |
| Publication date | 2021-04-01 |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | SAGE Open (JOURNAL) |
| Journal identifiers | ISSN: 2158-2440 • E-ISSN: 2158-2440 |
| Publisher | SAGE Publications Inc (PUBLISHER) |
| DOI | 10.1177/21582440211027167 |
| OpenAlex | W3176963028 |
| Language | EN |
| Citations received | 1 |
| References cited | 86 |
This study claims to be the first in assessing the short-run and long-run impacts of both the size and composition of fiscal adjustment on the growth in Pakistan. Empirical calibration has been made on Mankiw et al.'s model, while the Autoregressive Distributed Lag (ARDL) techniques of Pesaran et al. have been employed to carry out the estimation. To cure the problem of degenerate cases, the ARDL techniques have been augmented with the model of Sam et al. The analysis supports the hypothesis of "expansionary fiscal contraction" in the long run. The analysis reveals that the spending-based adjustment enhances the economic growth, whereas the tax-based adjustment would reduce the growth in the long run in the case of Pakistan. The Granger causality test indicates that the fiscal adjustments have been weakly exogenous, thereby allowing feedback effect from the economic growth toward the fiscal adjustment. Thus, the objective of sustained economic growth can be achieved through the spending-based consolidation measures
Autoregressive model · Cointegration · Distributed lag · Econometrics · Economics · Error correction model · Fiscal adjustment · Fiscal policy · Government spending · Granger causality · Macroeconomics · Monetary economics · Ricardian equivalence · Short run · Welfare · Fiscal Policies and Political Economy · Fiscal Policy and Economic Growth · Monetary Policy and Economic Impact
Likelihood-Based Inference in Cointegrated Vector Autoregressive Models
The Case for Restricting Fiscal Policy Discretion
Bootstrapping the autoregressive distributed lag test for cointegration
Fiscal Policy in a Depressed Economy
The Political Economy of Fiscal Adjustments
Asymptotic Properties of Residual Based Tests for Cointegration
The saving and investment nexus for China
Fiscal Expansions and Adjustments in OECD Countries
The Great Crash, the Oil Price Shock, and the Unit Root Hypothesis
Efficient Tests for an Autoregressive Unit Root
Bounds testing approaches to the analysis of level relationships
Maximum Likelihood Estimation and Inference on Cointegration — With Applications to the Demand for Money
The political and institutional determinants of fiscal adjustments and expansions
On Adjusting the Hodrick-Prescott Filter for the Frequency of Observations
Keynesian, Classical and New Keynesian Approaches to Fiscal Policy
Financing vs. forgiving a debt overhang
Government ideology and fiscal consolidation
Government Spending in a Simple Model of Endogeneous Growth
Debt, Deficits, and Finite Horizons
The Time for Austerity
Macroeconomics
Selling Austerity
A Contribution to the Empirics of Economic Growth
Statistical analysis of cointegration vectors
The Ricardian Approach to Budget Deficits
Effects of Austerity
| Citations per year | 0.33 |
|---|---|
| Citation span | 2023 - 2023 (1) |
| Highly cited | No |