Abstract
Problem statement: It is important for policy makers to find affect of monetary and fiscal policy on economic growth and to know how those impacts on growth to present a effective policies. Approach: We apply the bounds testing (ARDL) approach and to cointegration which is more appropriate for estimation in small sample studies. The data span for the study is from 1960-2006, the empirical results found a cointegration relations between Growth, monetary policy and fiscal policy in Iran. Results: The results indicated the impact of Exchange rate and inflation on growth was negative, government expenditure was found to have significant positive impact on growth. Conclusion: According to results for a sustainable economic growth in Iran, policy makers must try to decrease inflation rate and exchange rate also to find an equilibrium point for government expenditure in futures.
Original language | English |
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Pages (from-to) | 415-419 |
Number of pages | 5 |
Journal | American Journal of Applied Sciences |
Volume | 7 |
Issue number | 3 |
DOIs | |
Publication status | Published - 2010 |
Externally published | Yes |
Keywords
- ARDL cointegration
- Fiscal policy
- Growth
- Iran
- Monetary policy