An Empirical Analysis of Discretionary and Accumulated Effects of Chinese Government Expenditure on Its GDP Growth -A Study Based on SVAR Approach

摘要

This paper does an empirical analysis on the discretionary and accumulated effects of Chinese government expenditure on its GDP growth using the structure vector auto regression technique (SVAR). The variables involve government expenditure, tax revenue and GDP. The data used is an annual time series data covering the period of 1978-2008. Empirical results indicate that discretionary effect of Chinese government expenditure does not strongly react systematically to output changes while accumulated effect on GDP has a positive effect on GDPs long run growth.