IDEAS home Printed from https://ideas.repec.org/a/wei/journl/v8y2018i1p2-10.html
   My bibliography  Save this article

On the Measurement of the Government Spending Multiplier in the United States: an ARDL Cointegration Approach

Author

Listed:
  • Esmaeil Ebadi

    (Department of Economics, Grand Valley State University, Grand Rapids, MI, United States of America)

Abstract

This paper applies annual data from 1962 to 2011 to investigate the long run relationship between government spending and Gross Domestic Product (GDP). The common approach only considers defense government spending to estimate the multiplier to overcome the identification problem and endogeneity in isolating the effect of changes in government spending on GDP, I use the Autoregressive Distributed Lag (ARDL) approach to cointegration, which works despite having endogenous regressors to estimate the spending multiplier. The results confirm that government spending can be treated as a ‘long-run forcing’ variable for the explanation of real GDP and the long-run multiplier is found to be 1.94.

Suggested Citation

  • Esmaeil Ebadi, 2018. "On the Measurement of the Government Spending Multiplier in the United States: an ARDL Cointegration Approach," Economic Research Guardian, Weissberg Publishing, vol. 8(1), pages 2-10, June.
    • Handle: RePEc:wei:journl:v:8:y:2018:i:1:p:2-10
    as

    Download full text from publisher

    File URL: http://www.ecrg.ro/files/p2018.8(1)3y1.pdf
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Raymond Osi Alenoghena, 2019. "Fiscal Policy Determinants of Money Demand in Nigeria: ARDL Bound Testing Approach," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(2), pages 13-22, December.
    2. Ebadi, Esmaeil, 2018. "On the Effect of Government Spending on Money Demand in the United States: An ARDL Cointegration Approach," MPRA Paper 86399, University Library of Munich, Germany.

    More about this item

    Keywords

    Governments pending; Spending multiplier; ARDL approach;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wei:journl:v:8:y:2018:i:1:p:2-10. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Mihai Mutascu (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.