A study of the relationship between the budget deficit and the inflation rate in Algeria during the period (1990-2023): an econometric approach

Abstract

This study aims to measure the impact of the budget deficit on the inflation rate in Algeria during the period (1990-2023) using annual data and relying on the (ARDL) model. This study found that there is a co-integration relationship between the inflation rate and the budget deficit, according to what was indicated by the results of the Bound Test Approach through the calculated statistical value (F) which was greater than the upper critical value at a significance level of 10% and 5%. The study also indicated the existence of a long-term inverse relationship between the budget deficit and the inflation rate in Algeria during the period under study.