The study aims to examine the effect of the Corona pandemic (COVID19) on the government general budget deficit, using econometrics models for this purpose, by using yearly panel data from 2019 to 2021 for 38 countries; this study applied pooled regression, fixed effects, and random effects to examine the relationships between variables. According to the Hausman test and the redundant fixed effects, the fixed effects model was the best suitable, and there is no serial correlation problem, multicollinearity problem, and Heteroscedasticity problem. The study results indicated that COVID19 has a positive and significant effect on the government general budget deficit among the sample countries over the period under consideration. The increase in Covid19 yearly cases by 10% led to an increase in budget deficit a percentage of GDP by 0.2%.
Impact of Covid19 on the Government Budget Deficit
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- Written by Ahmed AL-Majali, Sulieman AL Oshaiba
- Category: Business and Finance Economics
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