The Impact of Public Expenditures on Economic Growth in Jordan

Abstract

This research aims at examining the impact of the public expenditures on economic growth in Jordan during the time period (1993–2013), by determining the contribution of the current and capital expenditures on Education, Health, Economic Affairs, and Housing and community Utilities as a percent of the total public expenditures, and then examining the impact of each one of them on economic growth in Jordan. Two mathematical models have been designed to measure this impact, the first one measures the impact of current functional expenditures, and the second model measures the impact of capital functional expenditures on economic growth in Jordan. The empirical results show that the impact of current and capital expenditures on education has failed to enhance economic growth, and that is due to the high cost of education, especially higher education in the private sector in Jordan, as well as the growing rate of unemployment, and expenditures on health and economic affairs should be encouraged due to their positive impact on economic growth. Keywords: economic growth, capital expenditures, current expenditures 1.