Volume 8, Issue 2, April 2019, Page: 69-77
The Role of Government Capital Expenditures in Economic Growth in Jordan
Basema Al-Sharif, Department of Finance, School of Business, University of Jordan, Amman, Jordan
Adel Bino, Department of Economy, School of Business, University of Jordan, Amman, Jordan
Received: Feb. 22, 2019;       Accepted: Apr. 12, 2019;       Published: May 23, 2019
DOI: 10.11648/j.ijber.20190802.15      View  167      Downloads  54
Abstract
This research aims at examining the role of government capital expenditures in economic growth in Jordan during the time period (1977-2016). The study collects the required data from the Central Bank of Jordan, the Department of Statistics, and the Ministry of Finance database. The analyzes is based on estimating the output as a function of input and control variables and analyzing the Gross Domestic Product (GDP) as a function of the total capital expenditures. The study found that first, the change in capital expenditures as a percentage of GDP has long-term equilibrium and has a short-term effect, but this result is unreliable due to model instability. Second, there is a short-term impact of net fixed capital formation and net tax on economic growth but there is no long-term equilibrium, and finally there is a short-term and long-term effect of government debt on economic growth. These findings can provide significant insights into many aspects of implementing policy in Jordan.
Keywords
Economic Growth, Capital Expenditures, Gross Fixed Capital Formation, Net Tax, Government Debt
To cite this article
Basema Al-Sharif, Adel Bino, The Role of Government Capital Expenditures in Economic Growth in Jordan, International Journal of Business and Economics Research. Vol. 8, No. 2, 2019, pp. 69-77. doi: 10.11648/j.ijber.20190802.15
Copyright
Copyright © 2019 Authors retain the copyright of this article.
This article is an open access article distributed under the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/) which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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