Investigating panel causality between fiscal policies (tax revenue and government expenditures), economic growth, and inflation in Iran
Year: 2024
Type: article
Abstract: According to the important role of governments in economic development and the interrelationships between government's fiscal policies with economic growth and inflation rate, especially in developing countries such as Iran, and based on previous theoretical studies, the main purpose of this study is to investigate the causal relationships between fiscal policies (tax revenues and government expenditures) with economic growth and inflation rate in the provinces of Iran during 2009-2021, applying Domitrescu-Horlin causality test.The results indicate that there is a two-way causality between taxes and government expenditures, a two-way causality between taxes and economic growth, no causality between government expenditures and economic growth, a one-way causality from inflation rate to taxes, a two-way causality between government expenditures and inflation, and a one-way causality from inflation to economic growth.Based on the results, it is suggested that the government make changes in its expenditures by creating a suitable and efficient tax system to help reduce the inflation rate and affect the budget deficit.
Source: Akhbaār-i iqtiṣād
Authors: Hamed Abdolmaleki, Sirous Haghverdi
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W4406101976