Using )TR( Methodology to Study The Relation between Inflation and Economic Growth in Syria during the period (1960-2015)

Abstract

The study seeks to analyze the phenomenon of Inflation in the Syrian economy and examines the possibility of existence a certain inflation rate, which if inflation exceeds, the relationship between inflation and economic growth changes, which is known as "Inflation Threshold" which the inflation may pose extra negative effects to the Syrian economy.

The researcher depended on inflation and economic growth data for the period of 1990-2015, and using the econometric analysis of a model developed by Khan and Senhadji (2001).

The study found out that the inflation threshold in Syria is at the level of 9%; that means any inflation rate higher than 9% is damaging the economic growth for short and long term; the study was able to define an appropriate model for short term from a statistical, eco-metrics and economic view. However, it was rejected for long term because the data were not from the same source. The study recommended doing more studies about this topic for its importance especially for policy and decision makers to help them and prevent the inflation rate to go upper than the threshold of inflation.