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Exploring Economy Dependence in the Middle East Using Governmental Accounting Indicators: The Case of Palestine, Jordan & Israel

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  • Zahran Mohammad Ali Daraghma
  • Raed Ali Mahmoud Iriqat

Abstract

This paper aims at examining the causality between Palestine, Jordan, and Israel economics using three macroeconomic (governmental accounting) measurement indices: Gross Domestic Product [GDP], Inflation Rate [IR] and Unemployment Rate [UR]. In order to achieve this purpose, this manuscript employs a macroeconomic time series analysis on data gathered Palestine, Jordan, and Israel from 1997-2014. The paper employs a variety of econometric statistical methods (e.g. descriptive statistics, correlation tests, ordinary least squares, and Granger causality test). The findings of this paper statistically support the notion that both GDP in Israel and GDP in Jordan effects the Palestinian GDP. These findings put an emphasis on the dependency of the Palestinian economy on both the Jordanian and Israeli economies. Furthermore, in lieu of the findings, this study recommends that fiscal policy makers in Palestine exert serious efforts to attract additional foreign and expatriate investments, attempt to create a stable and attractive entrepreneurial and investment climate, and build national support for local products and services to minimize the interdependence. These recommendation could inspire greater confidence in the Palestinian economy and help create a better investment climate.

Suggested Citation

  • Zahran Mohammad Ali Daraghma & Raed Ali Mahmoud Iriqat, 2016. "Exploring Economy Dependence in the Middle East Using Governmental Accounting Indicators: The Case of Palestine, Jordan & Israel," International Business Research, Canadian Center of Science and Education, vol. 9(1), pages 154-164, January.
    • Handle: RePEc:ibn:ibrjnl:v:9:y:2016:i:1:p:154-164
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    References listed on IDEAS

    as
    1. Bernhardsen, Tom, 2000. "The relationship between interest rate differentials and macroeconomic variables: a panel data study for European countries," Journal of International Money and Finance, Elsevier, vol. 19(2), pages 289-308, April.
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    More about this item

    Keywords

    governmental accounting; Paris protocol; inflation rate; unemployment; gross domestic product; Middle East;
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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