Reexamining the Relationship between Government Revenues and Expenditures in Iran: Symmetric or Asymmetric? | ||
| پژوهشنامه اقتصادی | ||
| Article 6, Volume 12, Issue 47, January 2013, Pages 123-152 PDF (342.91 K) | ||
| Document Type: Research Paper | ||
| Authors | ||
| Ali Hussein Samadi1; Naghmeh Zare Haghighi2 | ||
| 1Professor in Economics, Shiraz University, Shiraz, Iran. | ||
| 2Master of Science in Economics, Shiraz University, Shiraz, Iran. | ||
| Abstract | ||
| The main purpose of this paper is to examine the causal relationship between government revenues and expenditures in Iran. We use an asymmetric error correction model within a Threshold Autoregressive (TAR) and Momentum Threshold Autoregressive (MTAR) framework during 1991-2010. Contrary to previous studies on Iranian economy, the results show that synchronization hypothesis with asymmetric adjustment towards long run equilibrium is confirmed between government revenues and expenditures. The policy implication of the results is that the government should simultaneously rise revenues and decrease spending in order to control the budget deficits. | ||
| Keywords | ||
| Oil Revenue; Tax Revenue; Government Spending; Asymmetric Adjustment; TAR; MTAR; Budget; Iran | ||
| References | ||
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