The Nexus among Domestic Investment, Taxation, and Economic Growth in Germany: Cointegration and Vector Error Correction Model Analysis

Sayef Bakari, Ali Ahmadi () and Sofien Tiba
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Ali Ahmadi: Faculty of Economic Sciences and Management of Sfax, University of Sfax, (Tunisia)

Journal of Smart Economic Growth, 2020, vol. 5, issue 1, 37-47

Abstract: The development of endogenous growth theory has opened an avenue through which the effects of taxation on economic growth can be explored. Indeed, several empirical studies have examined the effect of many criteria, typically measured as domestic investment, on economic growth. This study reviews the theoretical and empirical evidence to assess whether a consensus arises as to how taxation affects the rate of economic growth. It is shown that the theoretical models isolate several channels through which taxation can affect growth and that these effects may be very. Our empirical facts record that both taxation of corporate and domestic investment positively influence economic growth, as well as, economic growth can affect taxation.

Keywords: Taxation; Domestic Investment; Economic Growth; Germany; VECM (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (13)

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Working Paper: The Nexus among Domestic Investment, Taxation, and Economic Growth in Germany: Cointegration and Vector Error Correction Model Analysis (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:seg:012016:v:5:y:2020:i:1:p:37-47

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