Simultaneous impact of good governance and government spending elements on economic growth in MENA countries

Maleki, Behzad; Jafari, Mohammad; Fatahi, Shahram; Ghafari, Hadi

Simultaneous impact of good governance and government spending elements on economic growth in MENA countries

Document Type : Original Article

Authors

behzad maleki ¹

Mohammad Jafari ²

Shahram Fatahi ³

hadi ghafari ⁴

¹ PhD student of Economics, Lorestan University

² Associate Professor, Faculty of Economics, Lorestan University, Khorramabad, Iran

³ Associate Professor, Faculty of Economics, Razi University, Kermanshah, Iran

⁴ Associate Professor of Economics and Faculty Member of Payame Noor University

Abstract

Abstract: The purpose of the study is the simultaneous effect of good governance and governmental expenditures’ elements on economic growth in the MENA countries. To estimate the pattern, the generalized method of moment (GMM) was used from 2002 to 2017. The results show that good governance (weighted average of six indicators) and governmental expenditures have good and significant effect on economic growth. The effect of variables of gross national product (GNP) in the past times and opening of business is positive and significant on economic growth. The economic affairs and public affairs expenditures have negative and significant effect on economic growth. The effect of social expenditure variable is positive and significant on economic growth. Good governance index, which is derived from the combination of six existing indicators by main component analysis, is estimated in another model, which indicates a positive relationship with more impact on economic growth.
Keywords: Good governance - Government expenditures elements- Economic growth- MENA area countries -GMM-
GEL category: H50- H51- H89.

Keywords

Good governance

Government expenditures elements

Economic growth

MENA area countries

GMM

الف- فارسی
1. 1. اسدی، منیژه؛ نیکوقدم، مسعود؛ هراتی، جواد؛ «ارتباط متقابل مخارج بهداشتی دولت و رشد اقتصادی در کشورهای منتخب حوزه منا: رویکرد سیستم معادلات هم‌زمان»، فصل‌نامه اقتصاد و الگوسازی، 1396، سال هشتم، شماره 21، ص 87-55.
2. 2. امیری، بهزاد؛ شاه‌آبادی، ابوالفضل؛ «تأثیرنهادهابرتوسعهکشورهایاسلامیعضوگروهدی هشت»، فصل‌نامه نظریه‌های کاربردی اقتصاد، 1394، سال سوم، شماره 2، ص 118-93.
3. 3. بیگی نیا، عبدالرضا و همکاران؛ «شناساییواولویت‌بندیشاخص‌هایحکمرانیخوب»، مجله چشم‌انداز مدیریت دولتی، 1391، شماره 3، ص 86-65.
4. 4. جاسبی، جواد؛ نفری، ندا ؛ «طراحیالگویحکمرانیخوببرپایهنظریهسیستم‌هایباز»،فصل‌نامه علوم مدیریت ایران، 1388، شماره 16، ص 117-85.
5. 5. حسینی، سید مهدی و همکاران؛ «ترکیباجزایمخارجدولتوتأثیرآنبررشداقتصادی باتأکیدبراموروفصولبودجهعمومیدولت»، فصل‌نامه پژوهش‌ها و سیاست‌های اقتصادی، سال شانزدهم، شماره 48، زمستان 1387، ص37-63.
6. 6. حیدری، حسن و همکاران؛ «رابطه‌ی بین اندازه‌ی دولت و رشد اقتصادی: مطالعه‌ی موردی کشورهای عضو اوپک حاشیه خلیج‌فارس»، فصل‌نامه اقتصاد مقداری،1389، سال سوم، شماره 7، ص،66-43.
7. 7. سپهر دوست، حمید و همکاران؛ «بررسی تأثیر حکمرانی خوب بر عملکرد درآمدی نظام مالیاتی»، فصل‌نامه نظریه‌های کاربردی اقتصاد، 1394، سال دوم، شماره 2، ص 126-103.
8. 8. شاکری، محبوبه و همکاران؛ «ارتباطبینمتغیرهاینهادیورشداقتصادی: معرفیشاخصنهادیجدیدبرای منطقهخاورمیانهوشمالآفریقا»، فصل‌نامه پژوهش‌های رشد و توسعه اقتصادی، 1394، سال بیست‌ویکم، شماره6، ص 106-93.
9. 9. شاه‌آبادی، ابوالفضل؛ ساری گل، سارا؛ «اثر حکمرانی و حقوق مالکیت فکری بر سرریز دانش در کشورهای در حال توسعه منتخب»، فصل‌نامه پژوهش‌نامه بازرگانی، 1395، شماره78، ص123-93.
10. 10. صامتی، مرتضی و همکاران؛ «تحلیلتأثیرشاخص‌هایحکمرانیخوببرشاخص توسعهانسانیمطالعهموردی: کشورهایجنوبشرقیآسیا(ASEAN) »، فصل‌نامه علمی پژوهشی،پژوهش‌های رشد و توسعه اقتصادی، 1390، سال چهارم، شماره 1، ص 223-183.
11. 11. صیادزاده، علی و همکاران؛ «بررسی رابطه بین اندازه دولت و رشد اقتصادی در ایران: برآورد منحنی آرمی»، پیکنور، 1386، سال چهارم، شماره 5، ص 112-95.
12. 12. فراهانی فر، سعید و همکاران؛ «تأثیر مؤسسات بانکی و غیربانکی اسلامی بر رشد اقتصادی ایران (روش گشتاور تعمیم‌یافته GMM)»، فصل‌نامه مدل‌سازی اقتصادی، 1394، سال سوم، شماره 9، ص 41-21.
13. 13. قطمیری، محمدعلی و همکاران؛ «بررسیتأثیرمخارجدولتیومنابعتأمینمالیآنبر تولیدناخالصداخلیورشداقتصادی: موردایران (82-1346)»، فصل‌نامه بررسی‌های اقتصادی، بهار ٨٥، دوره ٣، شماره ١، ص35-5.
14. 14. کمیجانی، اکبر و همکاران ؛«بررسیتأثیراندازهوکیفیتدولتبررشداقتصادیدرایرانبهروشهم‌جمعیARDL »، فصل‌نامه اقتصاد کاربردی، 1393، شماره 4، ص 60-49.
15. 15. میدری، احمد؛ «مقدمه‌ای بر نظریه حکمرانی خوب»، فصل‌نامه علمی پژوهشی رفاهاجتماعی،1383، سال بیست‌ودوم، شماره6، ص 287-261.
  1. 16. Acemoglu, D.&. Garcia-Jimeno, C. &. Robinson, J.A. (2013). State capacity and development: A Network Approach. NBER, Working Paper No. 19813.
  2. 17. Afxentiou, P.C.,& Serletis.A. (1996). Government expenditure in the European Union: do they converge or follow Wagner’s Law. Int Econ J, 10,33–47.
  3. 18. Aisen, A. & Veiga, F. J. (2013). How does political instability affect economic growth. Journal of Political Economy, 29(c), 151-167.
  4. 19. Akitoby, B., Clements, B.& Gupta S, Inchauste. G. (2006). Public spending, voracity and Wagner’s law in developing countries. Eur J Polit Econ ,22(4),908–924.
  5. 20. Ansari,M.I., Gordon D.V,& Akuamoah. C. (1997). Keynes versus Wagner: public expenditure and national income for three African countries. Appl Econ ,29(4),543–550.
  6. 21. Arellano. M.,& Bond. S. (1991). Some tests of specification for panel data: Monte Carlo evidence and an application to employment equations. Rev Econ Stat ,58(2),277–297.
  7. 22. Asaduzzaman1,m.& Virtanen,P.(2016). Governance Theories and Models. https://www.researchgate.net/publication/308911311.
  8. 23. Asimakopoulos,S.,& Karavias,Y.(2015). The impact of government size on economicgrowth: a threshold analysis. Granger Centre Discussion Paper , (15)2,1-8.
  9. 24. Assari.A, Sahabi. B, Mozayyeni. A. H.,& Rasouli. A. (2016). The Effects of the Resource Curse Indices and Good Governance on HealthExpenditures in Different Income Deciles: Mediterranean Journal of Social Sciences,( 7) 4 ,203-213.
  10. 25. Atsuyoshi.M.,& Francisco.J.V. (2016). Public spending and growth: The role of government accountability, European EconomicReview 89,148–171.
  11. 26. Akai, N. (2005). Short-run and Long-run Effects of Corruption on Economic Growth: Evidence from State-Level Cross-Section Data for the United States. The paper presented at the Bi-Annual Meeting of the Japanese Economic Association (at Kyōto Sangyō University, 4–5 June 2005).
  12. 27. 27.Barro, R. J. (1991). Economic growth in a cross section of countries. The Quarterly Journal of Economics, 106(2), 407–443.
    1. 28. Bichaka.F.,& Fahad.G.(2015). Revisiting the growth-governance relationship in developing Asian and Oceanic economies: Journal of Economics and Finance, (10)4, 803–816.
    2. 29. Biswal. B, Dhawan.U.,& Hooi.Y. L. (1999). Testing Wagner versus Keynes using disaggregated publicexpenditure data for Canada. Appl Econ, 31(10),1283–1291.
    3. 30. Chandran Govindaraju,V.G.R.,& Anwar,R.R.S.(2011). Economic growth and government spendingin Malaysia: a re-examination of Wagnerand Keynesian views: Econ Change Restruct (2011), 44,203–219.
    4. 31. Chow.Y.F, Cotsomitist.J.A.,& Kwan. A.C.C. (2002). Multivariate cointegration and causality tests of Wagner’s hypothesis: evidence from the UK. Appl Econ ,34(13),1671–1677.
    5. 1. Costantini, V. & Liberati, P. (2011). Technology transfer, institutions and development. University Degli Studi, Dipartimen to Di Economia, Working Paper No 135.
    6. 2. D’AGOSTINO.G, DUNNE,J.P.,& PIERONI,L.(2016). Government Spending, Corruption and Economic Growth, World Development, (84), 190-205.
    7. 3. Devlin. N.,& Hansen. P. (2001). Health care spending and economic output: granger causality. Appl Econ Lett,8(8),561–564.
    8. 4. Dunne,J.P. (2012). Military Spending, Growth, Development And Conflict, Defence and Peace Economics,(23)6, 549-557.
    9. 5. Ekundayo,W.J.(2017). Good Governance Theory and the Quest for Good Governance in Nigeria. International Journal of Humanities and Social Science. (7)5,154-161.
    10. 6. Farag,M., Nandakumar,A.K., Wallack,S., Hodgkin,D., Gary Gaumer.,& Erbil,C.(2013). Health expenditures, health outcomes and the role of good governance, Int J Health Care Finance Econ (2013), 13,33–52.
    11. 7. Freund, C. & Bolaky, B. (2008). Trade, regulations and income. Journal of Development Economics, 87(2), 309-321.
    12. 8. Greene,W. H. (1951).Econometric analysis /William H. Greene.7th ed. p. cm.
    13. 9. Goede,M.&. Neuwirth,R.J. (2014). Good governance and confidentiality: a matter of the preservation of the public Sphere. Corporate Governance ,(14)4, 543 – 554.
  13. 10. Gurgul, H. & Lach, L. (2012). Political instability and economic growth: evidence from two decades of transition in CEE. MPRA, Working Paper No. 37792.
  14. 11. Hopper,T. (2017). Neopatrimonialism, Good Governance, Corruption and Accounting in Africa: Idealism versusPragmatism. Journal of Accounting in Emerging Economies,(7)2, pp.
  15. 12. Innocent,M.,& Bernadette,O.(2015).Quality of governance, public spending on health and health status in Sub Saharan Africa: a panel data regression analysis. BMC Public Health,15-32.
    1. 13. Iyer, L. (2010). Direct versus indirect colonial rule in India: long-term consequences. Journal of Review of Economics and Statistics, 92(4), 693-713.
    2. 14. Jamaliah, S. Md., Mahmudul, A. M.,& Akmar, K. (2016).Relationship between good governance and integritysystem: empirical study on the public sector of Malaysia. Humanomics, (32)2,1-15.
    3. 15. Katsamunska,P.(2016). The Concept of Governance and Public Governance Theories, Economic Alternatives, 2,133-141.
    4. 16. Kaufmann, D., Kraay, A., & Mastruzzi, M. (2010). Governance Matters: The WorldwideGovernance Indicators, Aggregate Indicators of Governance 1996-2010. URL: http :// www.govindicators.org.
    5. 17. Levine, R., & Renelt, D. (1992). A sensitivity analysis of crosscountrygrowth regressions. American Economic Review, 82(4), 942–963.
    6. 1. Miller,T.&. Holmes,K.R.&.Feulner,E.J.(2017).Index of Economic Freedom. The Heritage Foundation in partnership with The Wall Street.
    7. 2. Meon, P. G., & Weill, L. (2010). Is corruption an efficient grease. World Development, 38(3), 244–259.
    8. 3. North, D. C. (1990). Institutions, Institutional Change and Economic Performance. NewYork: Cambridge University Press.
    9. 4. Peacock, A.,& Scott,A. (2000). The curious attraction of Wagner’s law. Public Choice, 102(1/2),1–17.
    10. 5. Przeworski, A., Alvarez, M., Cheibub, J. A. & Limongi, F. (2008). Democracy and development: political institutions and well-being in the world 1950-1990. Cambridge University Press, New York.
    11. 6. Ram R (1986) Causality between income and government expenditure: a broad international perspective.Public Financ 41:393–414.
    12. 7. Ram, R. (1987). Wagner’s hypothesis in time-series and cross-section perspectives: evidence from ‘‘Real’’data for 115 countries. Rev Econ Stat, 69(2),194–204.
    13. 8. Riayati ,A.,&Junaidah.H.(2016). Public Health Expenditure, Governance and Health Outcomes in Malaysia( Perbelanjaan Awam, Urus Tadbir dan Natijah Kesihatan di Malaysia). Jurnal Ekonomi Malaysia, 50(1) , 29 -40.
  16. 9. Rodrik, D., Subramanian, A. & Trebbi, F. (2002). Institutions rule: the primacy of institutions geography and integration in economic development. NBER, Working Paper No. 9305
  17. 10. Sabry,M.I. (2015).Good governance, institutions and performance of public privatePartnerships. International Journal of Public Sector Management, (28)7, 566 – 582.
  18. 11. Silberberger, M. (2015). Regulation, trade and economic growth. Center for European Governance and Economic Development, Discussion Paper No. 255.
  19. 12. Spiteri,J.&. Briguglio,M.(2018).Does Good GovernanceFoster Trust in Government? An Empirical Analysis" In Governance and Regulations. Contemporary Issues. Published online, 12 ,121-137.
  20. 13. The Worldwide Governance IndicatorsMethodology and Analytical IssuesThe World BankDevelopment Research GroupMacroeconomics and Growth Team September 2010.
  21. 14. Thornton. J. (1999). Cointegration, causality and Wagner’s law in 19th century Europe. Appl Econ Lett,6(7),413–416.
  22. 15. Tridico, P. (2013). The stage of development among former communist economies: social capital, the middle class and democracy. Journal of Socio-Economics, 44(c), 47-58.
  23. 16. United Nations Development Program. (2016). Human development report 2016. Available at the http://hdr.undp.org/en/content/human-development-report-2016.
  24. 17. Vermunt, J. K. & Magidson, J. (2005). Factor Analysis with Categorical Indicators: A Comparison between Traditional and Latent Class Approaches. In A. Van der Ark, M.A.Croon and K.Sijtsma (eds), New Developments in Categorical Data Analysis for the Social and Behavioral Sciences,41-62.
  25. 18. Wahab, M. (2004). Economic growth and government expenditure: evidence from a new test specification.Appl Econ ,(36)2,125–2135.
  26. 19. Wei, A. J. (1999). Corruption in economic development – Beneficial grease, minor annoyance, or major obstacle, Policy Research Working Paper Series 2048. The World Bank.
  27. 20. World Bank (2016). http://data.worldbank.org