الفعالية النسبية للسياستين الماليـة والنقدية في النشــاط الاقتصادي: دراسة مقارنة بين الأردن والجزائر
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- Category: Department of Economics, Business & Finance
- Published: Thursday, 26 April 2012 03:00
- Written by Amina Nour-eddine Meghlaoui
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The Relative Effectiveness of Monetary and Fiscal Policies in Economic Activity:
A Comparison between Jordan and Algeria by Using a Structural Vector Autoregressive (SVAR)
Amina Nour-eddine Meghlaoui
Mu’tah University, 2011
This study aims to investigate the relative effectiveness of both fiscal and monetary policies in economic activity in both countries: Jordan and Algeria, during the period (1980-2009), where the Structural Vector Autoregressive (SVAR) was applied for the following variables: the Gross Domestic Product (GDP) per capita, the Government Expenditures to GDP ratio, the Money Supply to GDP ratio.
Moreover, two main statistical tools (Variance Decomposition and the Impulse Response Function) were used for the analysis. The findings revealed that first; the fiscal policy was relatively more effective than the monetary policy in the economic activity in Jordan, while monetary policy was found to be more effective relative to fiscal policy in economic activity in Algeria. Second, the impact of fiscal policy in Jordan was found to last for long period relative to the impact of the monetary policy. However the impact of monetary policy was found to last for long period relative to the impact of the fiscal policy in Algeria.
Finally, the study has recommended providing more coordination between fiscal and monetary policies, in order to achieve greater harmony in the orientations and goals of these policies in both Jordan and Algeria countries.
Key words: fiscal policy, monetary policy, the structural vector autoregressive (SVAR) model.