Volume 7, Issue 26 (12-2016)                   jemr 2016, 7(26): 65-87 | Back to browse issues page

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Monjazeb M, Mahmoodi Pati M. Government Size and Inflation in Developing Countries: a Panel Data Approach. jemr 2016; 7 (26) :65-87
URL: http://jemr.khu.ac.ir/article-1-685-en.html
Government Size and Inflation in Developing Countries: a Panel Data Approach
Mohammadreza Monjazeb1 , Mohsen Mahmoodi Pati * 2
1- Kharazmi University
2- , mmp4369@yahoo.com
Abstract:   (8369 Views)

The main objective of this study is: investigate the effect of government size on inflation rate in the 34 countries of the developing countries during the years 1998 to 2013. For this purpose, the index of total government spending as a percentage of GDP, used as government size and then the model of this study has been estimated by using the panel data technique.
The results of this study imply that the government size has had significant negative effect on the inflation rate and also the variables: liquidity growth rate, growth rate of import price and interest rate have had positive effect on the inflation. Furthermore, the growth rate of GDP, with a difference of degree has significant negative effect on inflation. Hence, the most important result of this study is the majority of the general government- spending in Developing countries has led to the Construction costs and investment in infrastructures that has strengthened. The supply side of the economy of these Countries that The origin of this effect can be the retarded economic structures of these countries.

Keywords: Government Size, Inflation, Panel Data Models, Developing Countries
Full-Text [PDF 1861 kb]   (5531 Downloads)    
Type of Study: Applicable | Subject: بخش عمومی
Received: 2013/03/3 | Accepted: 2017/01/29 | Published: 2017/03/1
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