IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/56435.html
   My bibliography  Save this paper

آثار عجز الميزانية على الإدخار الخاص في الإقتصاد المغربي عبر نمذجة التقهقر الذاتي البنيوي
[Effects of Budget Deficit on Private Savings in Moroccan Economy using SVAR Modeling]

Author

Listed:
  • Ghassan, Hassan B.

Abstract

The purpose of this paper is to estimate a structural VAR model using macroeconomic data of Moroccan Economy, which includes national saving rate and budget deficit rate, to test the Ricardian Equivalence hypothesis. In this framework we separate saving and deficit movements into two types of shocks, associated with structural parameters, as we looking for two needles in haystack. We avoid to impose short run or long run constraints, which represents a methodological contribution and permits to obtain a best estimation of structural multipliers. The empirical results show that the mechanism of automatic stabilizing are indirectly checked in our sample. Our results suggest that Ricardian Equivalence did work in our sample, since private saving compensated a big fraction 90 per cent of the shock in budget deficit. This supports the interpretation that the large budget deficits, financed especially by debt, have been a very important factor behind the significant increase in real interest rates particularly in the eighties and early nineties.

Suggested Citation

  • Ghassan, Hassan B., 2003. "آثار عجز الميزانية على الإدخار الخاص في الإقتصاد المغربي عبر نمذجة التقهقر الذاتي البنيوي [Effects of Budget Deficit on Private Savings in Moroccan Economy using SVAR Modeling]," MPRA Paper 56435, University Library of Munich, Germany, revised 07 Feb 2004.
    • Handle: RePEc:pra:mprapa:56435
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/56435/1/MPRA_paper_56435.pdf
    File Function: original version
    Download Restriction: no
    File URL: https://mpra.ub.uni-muenchen.de/80645/1/MPRA_paper_56435.pdf
    File Function: revised version
    Download Restriction: no
    File URL: https://mpra.ub.uni-muenchen.de/80645/8/MPRA_paper_80645.pdf
    File Function: revised version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Poterba, James M. & Summers, Lawrence H., 1987. "Finite lifetimes and the effects of budget deficits on national saving," Journal of Monetary Economics, Elsevier, vol. 20(2), pages 369-391, September.
    2. Becker, Torbjorn, 1997. "An investigation of Ricardian equivalence in a common trends model," Journal of Monetary Economics, Elsevier, vol. 39(3), pages 405-431, August.
    3. Barro, Robert J, 1989. "The Ricardian Approach to Budget Deficits," Journal of Economic Perspectives, American Economic Association, vol. 3(2), pages 37-54, Spring.
    4. Poterba, James M. & Rueben, Kim S., 2001. "Fiscal News, State Budget Rules, and Tax-Exempt Bond Yields," Journal of Urban Economics, Elsevier, vol. 50(3), pages 537-562, November.
    5. N. Gregory Mankiw, 2000. "The Savers-Spenders Theory of Fiscal Policy," American Economic Review, American Economic Association, vol. 90(2), pages 120-125, May.
    6. Haug, Alfred A, 1996. "Blanchard's Model of Consumption: An Empirical Study," Journal of Business & Economic Statistics, American Statistical Association, vol. 14(2), pages 169-177, April.
    7. Evans, Paul, 1987. "Interest Rates and Expected Future Budget Deficits in the United States," Journal of Political Economy, University of Chicago Press, vol. 95(1), pages 34-58, February.
    8. Haug, Alfred A, 1990. "Ricardian Equivalence, Rational Expectations, and the Permanent Income Hypothesis," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 22(3), pages 305-326, August.
    9. Smetters, Kent, 1999. "Ricardian equivalence: long-run Leviathan," Journal of Public Economics, Elsevier, vol. 73(3), pages 395-421, September.
    10. Evans, Paul, 1993. "Consumers Are Not Ricardian: Evidence from Nineteen Countries," Economic Inquiry, Western Economic Association International, vol. 31(4), pages 534-548, October.
    11. Domenech, Rafael & Taguas, David & Varela, Juan, 2000. "The effects of budget deficit on national saving in the OECD," Economics Letters, Elsevier, vol. 69(3), pages 377-383, December.
    12. Piersanti, Giovanni, 2000. "Current account dynamics and expected future budget deficits: some international evidence," Journal of International Money and Finance, Elsevier, vol. 19(2), pages 255-271, April.
    13. Seater, John J, 1993. "Ricardian Equivalence," Journal of Economic Literature, American Economic Association, vol. 31(1), pages 142-190, March.
    14. Beck, Stacie E., 1994. "The effect of budget deficits on exchange rates: Evidence from five industrialized countries," Journal of Economics and Business, Elsevier, vol. 46(5), pages 397-408, December.
    15. Blanchard, Olivier J, 1985. "Debt, Deficits, and Finite Horizons," Journal of Political Economy, University of Chicago Press, vol. 93(2), pages 223-247, April.
    16. Seater, John J. & Mariano, Roberto S., 1985. "New tests of the life cycle and tax discounting hypotheses," Journal of Monetary Economics, Elsevier, vol. 15(2), pages 195-215, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Roberto Ricciuti, 2003. "Assessing Ricardian Equivalence," Journal of Economic Surveys, Wiley Blackwell, vol. 17(1), pages 55-78, February.
    2. Elmendorf, Douglas W. & Gregory Mankiw, N., 1999. "Government debt," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 25, pages 1615-1669, Elsevier.
    3. Brunila, Anne, 1997. "Current income and private consumption : Saving decisions : Testing the finite horizon model," Research Discussion Papers 6/1997, Bank of Finland.
    4. repec:zbw:bofrdp:1997_006 is not listed on IDEAS
    5. Brunila, Anne, 1997. "Current income and private consumption: Saving decisions: Testing the finite horizon model," Bank of Finland Research Discussion Papers 6/1997, Bank of Finland.
    6. Brunila, Anne, 1996. "Fiscal policy and private consumption: Saving decisions: Evidence from Finland," Bank of Finland Research Discussion Papers 28/1996, Bank of Finland.
    7. Ghassan, Hassan B., 2003. "Test de l’équivalence Ricardienne par la Modélisation SVAR [Ricardian Equivalence Test by SVAR Modeling]," MPRA Paper 56459, University Library of Munich, Germany, revised 05 Mar 2004.
    8. Lorenzo Pozzi, 2003. "Tax Discounting in a High‐debt Economy," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 65(3), pages 261-282, July.
    9. repec:zbw:bofrdp:1996_028 is not listed on IDEAS
    10. Brunila, Anne, 1996. "Fiscal policy and private consumption : Saving decisions : Evidence from Finland," Research Discussion Papers 28/1996, Bank of Finland.
    11. Domenech, Rafael & Taguas, David & Varela, Juan, 2000. "The effects of budget deficit on national saving in the OECD," Economics Letters, Elsevier, vol. 69(3), pages 377-383, December.
    12. Waqas, Muhamad & Awan, Masood Sarwar & Aslam, Muhammad Amir, 2011. "We are living on the cost of our children," MPRA Paper 32044, University Library of Munich, Germany.
    13. Normandin, Michel, 1999. "Budget deficit persistence and the twin deficits hypothesis," Journal of International Economics, Elsevier, vol. 49(1), pages 171-193, October.
    14. Hayo, Bernd & Neumeier, Florian, 2017. "The (In)validity of the Ricardian equivalence theorem–findings from a representative German population survey," Journal of Macroeconomics, Elsevier, vol. 51(C), pages 162-174.
    15. Jose Tavares & Rossen Valkanov, 2001. "The neglected effect of fiscal policy on stock and bond returns," Nova SBE Working Paper Series wp413, Universidade Nova de Lisboa, Nova School of Business and Economics.
    16. Alfred Haug, 2016. "A New Test of Ricardian Equivalence Using the Narrative Record on Tax Changes," Working Papers 1607, University of Otago, Department of Economics, revised Jul 2016.
    17. Koumparoulis, Dimitrios, 2006. "Ευρωπαϊκή Δημοσιονομική Πολιτική Και Οικονομική Μεγέθυνση: Η Νεοκλασική Οικονομική Θεωρία Για Την Περίπτωση Της Ελλάδας [European Fiscal Policy and Economic Growth: The Neoclassical Economic Theory," MPRA Paper 44310, University Library of Munich, Germany.
    18. Javier Andrés & Rafael Doménech, 2006. "Fiscal Rules and Macroeconomic Stability," Hacienda Pública Española / Review of Public Economics, IEF, vol. 176(1), pages 9-41, April.
    19. Robert P. Rebelein, 2006. "Strategic Behavior, Debt Neutrality, and Crowding Out," Public Finance Review, , vol. 34(2), pages 148-172, March.
    20. GHASSAN, Hassan, 2007. "Does The Constraint In The Matrix Of Long Run Effects Bias The Ricardian Equivalence Test?," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 7(1).
    21. T. D. Stanley, 1998. "New Wine in Old Bottles: A Meta‐Analysis of Ricardian Equivalence," Southern Economic Journal, John Wiley & Sons, vol. 64(3), pages 713-727, January.
    22. Kostas Drakos, 2001. "Testing the Ricardian Equivalence Theorem: Time Series Evidence from Greece," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 26(1), pages 149-160, June.

    More about this item

    Keywords

    Budget deficit; Saving; Ricardian Equivalence; SVAR; Morocco.;
    All these keywords.

    JEL classification:

    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • H6 - Public Economics - - National Budget, Deficit, and Debt

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:56435. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.