Samadi A H, Oujimehr S. (2014). An Investigation of The Non-Linear Effects of Fiscal Policy on Private Consumption in IRAN in A MarkovSwitching Model With Time Varying Transition Probabilities.
JEPR.
19(2), 133-150.
URL:
http://jpbud.ir/article-1-1189-en.html
1- , asamadi@rose.shirazu.ac.ir
Abstract: (6058 Views)
If with expansionary (contractionary) fiscal policy, private consumption increases (decreases), fiscal policy has Keynesian nature else, it has non- Keynesian nature. If in certain period, sometimes fiscal policy has Keynesian effects and sometimes it has non- Keynesian effects, it will have non-linear effects. Since, there is not a paper about non- linear fiscal policy in IRAN, the purpose of this paper, is to test the non-linear effects of fiscal policy on private consumption in IRAN, during 1993:2-2010:4. So we use a Markov-switching model with FTP and TVTP approach. The results of the estimation of the Markov switching model with FTP present the existence of significant non-linarites in the effects of fiscal policy in IRAN. Also the Keynesian regime is an absorbing regime such that the probability of remaining in the non- Keynesian regime is just, 1%. Furthermore, Estimation results for the TVTP model show that we cannot find any strong evidence about the sources of these non-linarites.
Type of Study:
Research |
Received: May 10 2015 | Accepted: May 10 2015 | ePublished: May 10 2015