Analysing the Armey curve based on the Fourier cointegration approach for Turkey

Q3 Economics, Econometrics and Finance

Economic Annals Pub Date : 2023-01-01 DOI:10.2298/eka2336139k

Süleyman Kasal

引用次数: 0

Abstract

One major theoretical and empirical issue that has dominated fiscal policy for many years concerns the optimal size of government. Armey (1995) believes that the relationship between government expenditure and economic growth is an inverted U-shape, arguing that there is an optimal point where government expenditures maximise economic growth. The primary objective of this study is to investigate the validity of the Armey curve for Turkey in the period 1998:Q1-2020:Q4 using the Fourier cointegration method. The study has found that the Armey curve is valid for Turkey. The evidence indicates that the optimal size of government in Turkey is equal to approximately 18.5% of GDP. This paper highlights that the notion that government expenditure increases economic growth should not be seen as the only policy option. A key policy priority should therefore be to design fiscal policies that take into account this non-linear relationship.

查看原文本刊更多论文

基于傅里叶协整方法的土耳其陆军曲线分析

多年来主导财政政策的一个主要理论和实证问题是政府的最优规模。Armey(1995)认为政府支出与经济增长之间呈倒u型关系，认为存在一个政府支出使经济增长最大化的最优点。本研究的主要目的是利用傅里叶协整方法调查土耳其陆军曲线在1998年第一季度至2020年第四季度的有效性。研究发现，陆军曲线对土耳其是有效的。有证据表明，土耳其政府的最优规模约等于GDP的18.5%。本文强调，政府支出促进经济增长的观念不应被视为唯一的政策选择。因此，一个关键的政策重点应该是设计考虑到这种非线性关系的财政政策。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

求助全文

约1分钟内获得全文求助全文

来源期刊

Economic Annals Economics, Econometrics and Finance-Economics, Econometrics and Finance (all)

CiteScore

0.90

自引率

0.00%

发文量

审稿时长

18 weeks

期刊介绍： Economic Annals is an academic journal that has been published on a quarterly basis since 1955, initially under its Serbian name of Ekonomski anali (EconLit). Since 2006 it has been published exclusively in English. It is published by the Faculty of Economics, University of Belgrade, Serbia. The journal publishes research in all areas of economics. The Editorial Board welcomes contributions that explore economic issues in a comparative perspective with a focus on transition and emerging economies in Europe and around the world. The journal encourages the submission of original unpublished works, not under consideration by other journals or publications. All submitted papers undergo a double blind refereeing process. Authors are expected to follow standard publication procedures [Instructions to Authors], to recognise the values of the international academic community and to respect the journal’s Policy.