An Empirical Note on Government Expenditure and Imports: an ARDL Cointegration Investigation

By focusing on the relationship between fiscal policy and the trade account this study will attempt to provide an insight into the empirical merits of the relationship between government expenditures and imports. To this aim an ARDL cointegration approach has been applied for the first time to a dataset spanning the Greek economy from 1970 to 2007 . The results obtained provide valuable insights into the direct effect of changes in government expenditure on import demand.