Document Details

Document Type : Article In Journal 
Document Title :
The Impact of Interest Rate on Investment in Jordan: A Cointegration Analysis
تأثير سعر الفائدة على الاستثمار في الأردن: تحليل تكامل مشترك
 
Document Language : English 
Abstract : The main aim of this study is to investigate the impact of real interest rate on investment level in Jordan over the period (1990-2005). A cointegration analysis with three variables (investment level, real interest rate, and income level) is employed. Two unit root tests (Phillips-Perron test and Augmented Dickey-Fuller test) have been exploited to check the integration order of the variables. The Johansen Cointegration test is mainly used. And for the purpose of supporting the results, the dynamic relationships among the variables are explained through presenting variance decomposition and impulse responses. The results were found to be in line with the economic theory and some other studies in the sense that real interest rate has a negative impact on investment, where it is found that an increase in the real interest rate by 1% reduces the investment level by 44%. On the other hand, the income level has a positive impact. 
ISSN : 1319-0997 
Journal Name : Economics and Administration Journal 
Volume : 24 
Issue Number : 1 
Publishing Year : 1431 AH
2010 AD 
Article Type : Article 
Added Date : Wednesday, February 24, 2010 

Researchers

Researcher Name (Arabic)Researcher Name (English)Researcher TypeDr GradeEmail
ماجد بدرBader, Majed Researcher  
أحمد إبراهيم ملاويMalawi, Ahmad IbrahimResearcher  

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