Analysis of compensation functions for public spending shocks and their impact on economic growth in Syria during the period (1990-2020) using the autoregressive (VAR)

Abstract

The research aims to study the impact of shocks to current and investment public spending on economic growth in Syria during the period (1990-2020), where data related to time series were obtained based on figures issued by both the Ministry of Finance and the Syrian Statistical Group. 
The study followed the descriptive approach using the autoregressive model (VAR) using the Eviews10 program. The study used unit root tests and relied on dynamic analysis by analyzing the variance components and the immediate response function. The results of the unit root tests revealed that all variables are stable at the first difference. As for the results of the shock analysis, they indicated that a shock to current public spending by one standard deviation has a negative impact on economic growth in the short term and a positive impact in the medium and long term, but it is a weak impact, while a shock to investment spending by one standard deviation 
has a negative impact on economic growth in the medium and long term. The study recommended increasing the flexibility of the productive apparatus in the economy to respond positively to any increase in public investment spending.