Main Article Content

Abstract

The broad objective of the present study is to analyse the effect of fiscal policy and trade liberalisation on economic growth as related to Jordan. For the empirical analysis, the study adopted Augmented Dicky Fuller unit root tests and Kapetanios unit root tests with structural breaks. Based on the findings, a well-defined the bound testing approach to cointegration and error correction models, developed within an autoregressive distributed lag (ARDL) framework. The simulation results indicate the government spending and taxes have a positive and significant effect on economic growth. Public debt has a negative and insignificant effect on economic growth. Trade liberalisation has a significant influence on economic growth. The implication is the proportion of spending on human resources and infrastructure should be increased by taxes financing rather than foreign loans. Competitiveness of domestic industries should be improved to achieve a positive impact of free trade

Keywords

ARDL, Kapetanios, Trade liberalisation, Structural breaks

Article Details

How to Cite
Ali, M. S. I., Tony, J. R., & Anputhasan, V. (2022). The Influence of Fiscal Policy and Trade Liberalisation on Jordan’s Economic Growth. International Journal on Economics, Finance and Sustainable Development, 4(6), 35-47. https://doi.org/10.31149/ijefsd.v4i6.2952

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