Testing Wagner’s law versus the Keynesian hypothesis for GCC countries

Author First name, Last name, Institution

Salah A. Nusair, University of Kuwait
Dennis O. Olson, Zayed University

Document Type

Article

Source of Publication

Applied Economics

Publication Date

1-1-2020

Abstract

© 2020 Informa UK Limited, trading as Taylor & Francis Group. This paper examines the relationship between real GDP and government spending for the six Gulf Cooperation Council (GCC) countries. Linear Granger causality tests in the time and frequency domains provide moderate support for Wagner’s law in four countries and weak support for the Keynesian model in two countries. In contrast, asymmetric nonlinear causality tests in the frequency domain support Wagner’s law in five countries, while some form of the Keynesian hypothesis is valid in all six GCC countries. Our results illustrate the importance of using nonlinear, asymmetric models to examine causal relationships.

DOI Link

10.1080/00036846.2020.1832196

ISSN

0003-6846

Publisher

Routledge

Last Page

23

Disciplines

Business

Keywords

asymmetric causality, frequency domain causality, GCC countries, Keynesian hypothesis, Wagner’s law

Scopus ID

85094657593

Recommended Citation

Nusair, Salah A. and Olson, Dennis O., "Testing Wagner’s law versus the Keynesian hypothesis for GCC countries" (2020). All Works. 3329.
https://zuscholars.zu.ac.ae/works/3329

Indexed in Scopus

yes

Open Access

no