Investigating the impact of government budget deficit on liquidity volume; through the monetary base channel مقاله

خلاصه ماشینی:

Accordingly, the present research seeks to investigate the impact of the government budget deficit on the money supply through the monetary base channel, and the statistics and information of the variables required in the model have been extracted as annual time series (1391-1393) from the Statistical Center and the data of the Central Bank of the Islamic Republic of Iran, and the software used is the econometric software Eviews. Vamvoukas 2 (2010) in a study titled "Relationship between government budget deficit and money demand: Evidence from a small economy" using the annual data of the Greek economy and by employing the cointegration method and the vector error correction model, has reached the conclusion that there exists a positive and significant relationship between budget deficit and money demand, which is a result supporting the Keynesian view. LLMY=β1+β2LGBD+β3LiRT+β4LNGD+U (9) where: LMY : liquidity volume 9 GBD : ratio of total government payments to total government revenues IRT : bank interest rate 2 NGD : ratio of public sector debt to the central bank to public sector deposits to the central bank U : model residual term L : logarithm symbol In the following, first the stability of the variables used in the model is examined, and after selecting the optimal lag based on the Schwarz criterion; the estimation of the vector autoregressive model 3 according to equations 2, 3, 4, and 3 is performed, and the impulse response functions are investigated. Table (2): Vector Error Correction Model (Refer to the page image) Source: Researcher's findings 6- Conclusion The main objective of the present research is to examine the impact of the government budget deficit on the volume of liquidity through the monetary base channel.