Interaction between Fiscal and Monetary Policies:  Directions of Causality in Case of Jordan 1990-2011

Hussein Ali Al-Zeaud

Authors

Hussein Ali Al-Zeaud

Keywords:

fiscal policy, monetary policy, government expenditure, money supply, inflation, granger-causality, co-integration, jordan

Abstract

This paper is an effort to explore the interaction between fiscal and monetary policies in Jordan through investigating the short-term and long-term relationship between government expenditure as a fiscal policy, money supply as a monetary policy, and inflation as a result and cause of these policies. Using annual data for the period 1990-2011, the study applies cointegration test, Granger-causality, and VECM techniques to inspect the long-term and shortterm relationship and the directions of causality, also the speed of adjustment toward long-term equilibrium between the variables.

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How to Cite

Interaction between Fiscal and Monetary Policies: Directions of Causality in Case of Jordan 1990-2011. (2015). Global Journal of Management and Business Research, 15(B2), 19-26. https://journalofbusiness.org/index.php/GJMBR/article/view/1643

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