WSEAS Transactions on Business and Economics
Print ISSN: 1109-9526, E-ISSN: 2224-2899
Volume 17, 2020
The Effect of Budget Deficit on the Economy of Jordan
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Abstract: This paper describes the impact of budget deficit on the Jordanian economy for the period (2010 – 2019) where budget deficit and inflation are explanatory variables and economic growth is the affected variable. This research concentrates on analyzing theoretical and empirical literature reviews to show the effects of budget deficit on economic growth and explaining this effect for this period using the Autoregressive distributed lag (ARDL) method in Eviews program. The results of this research show that budget deficit calculated as a percentage of GDP and inflation rate have insignificant effects on the Jordanian economy for the period (2010 – 2019). This paper concludes with a recommendation that, apart from budget deficit and inflation rate, other variables that affect the economy exist.
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Keywords: Budget deficit, Economy of Jordan, Inflation, Economic growth, Autoregressive distributed lag (ARDL)
Pages: 753-758
DOI: 10.37394/23207.2020.17.73