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impact of the budget deficit on key macroeconomic variables in the major industrial countries

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Date Issued:
1996
Summary:
This study was conducted to analyze the impact of the budget deficit on key macroeconomic variables in the seven major industrial countries (G-7): Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States. Four models were developed to test the impact of the budget deficit on the variables of importance within the economies of the countries in question. The first model tested the relationship between the budget deficit and the short-term interest rate. The second explored the impact of the budget deficit on the long-term interest rate. The third model examined the impact of the budget deficit on the trade balance. The fourth and final model was specified to explain the relationship between the budget deficit and economic growth. The data utilized in this study covered the period from 1964 to 1993 and were gathered mainly from the international statistics of the International Monetary Fund. The data were standardized in the form of the percentage of the gross domestic product and the percentage change over the previous year in order to compile similar data across the seven countries. Multiple regression analysis as well as meta analysis were used to analyze the data. The multiple regression results indicated that the budget deficit leads to higher short-term interest rates in Japan and the United States. With respect to the long term-interest rate, the budget deficit led to an increase of this rate in France, Germany, and the United States. The budget deficit, however, appeared to worsen the trade balance in Canada. In Italy and the U.S., the trade balance improved with the budget deficit. With respect to the economic growth, the budget deficit is a significant variable of growth in France, Germany, and Italy. When the data for the seven countries were combined in meta analysis, the results showed that the budget deficit led to higher short-term interest rates in the seven countries. The budget deficit, however, did not manifest any impact on the long-term interest rates. The trade balance was worsened by the budget deficit and the economic growth improved in all the seven major industrial countries.
Title: The impact of the budget deficit on key macroeconomic variables in the major industrial countries.
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Name(s): Al-Khedair, Saleh Ibrahim
Florida Atlantic University, Degree Grantor
Thai, Khi V., Thesis Advisor
Type of Resource: text
Genre: Electronic Thesis Or Dissertation
Issuance: monographic
Date Issued: 1996
Publisher: Florida Atlantic University
Place of Publication: Boca Raton, Fla.
Physical Form: application/pdf
Extent: 162 p.
Language(s): English
Summary: This study was conducted to analyze the impact of the budget deficit on key macroeconomic variables in the seven major industrial countries (G-7): Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States. Four models were developed to test the impact of the budget deficit on the variables of importance within the economies of the countries in question. The first model tested the relationship between the budget deficit and the short-term interest rate. The second explored the impact of the budget deficit on the long-term interest rate. The third model examined the impact of the budget deficit on the trade balance. The fourth and final model was specified to explain the relationship between the budget deficit and economic growth. The data utilized in this study covered the period from 1964 to 1993 and were gathered mainly from the international statistics of the International Monetary Fund. The data were standardized in the form of the percentage of the gross domestic product and the percentage change over the previous year in order to compile similar data across the seven countries. Multiple regression analysis as well as meta analysis were used to analyze the data. The multiple regression results indicated that the budget deficit leads to higher short-term interest rates in Japan and the United States. With respect to the long term-interest rate, the budget deficit led to an increase of this rate in France, Germany, and the United States. The budget deficit, however, appeared to worsen the trade balance in Canada. In Italy and the U.S., the trade balance improved with the budget deficit. With respect to the economic growth, the budget deficit is a significant variable of growth in France, Germany, and Italy. When the data for the seven countries were combined in meta analysis, the results showed that the budget deficit led to higher short-term interest rates in the seven countries. The budget deficit, however, did not manifest any impact on the long-term interest rates. The trade balance was worsened by the budget deficit and the economic growth improved in all the seven major industrial countries.
Identifier: 9780591052848 (isbn), 12466 (digitool), FADT12466 (IID), fau:9360 (fedora)
Note(s): Thesis (Ph.D.)--Florida Atlantic University, 1996.
Subject(s): Debts, Public
Budget deficits
Fiscal policy
International economic relations
Held by: Florida Atlantic University Libraries
Persistent Link to This Record: http://purl.flvc.org/fcla/dt/12466
Sublocation: Digital Library
Use and Reproduction: Copyright © is held by the author with permission granted to Florida Atlantic University to digitize, archive and distribute this item for non-profit research and educational purposes. Any reuse of this item in excess of fair use or other copyright exemptions requires permission of the copyright holder.
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Host Institution: FAU
Is Part of Series: Florida Atlantic University Digital Library Collections.