Investigating the Relationship between Globalization and Government Spending in Selected Middle East Countries using Dynamic Panel Estimation with GMM Ghaleno Nazar Dahmardeha, Eslamlue Esmat Ahmadib aAssociate Professor, Faculty of Economics, University of Sistan and Baluchestan, Zahedan, Iran bM.S of Economics, University of Sistan & Baluchestan, Iran Online published on 16 December, 2014. Abstract With the spread of globalization and its impact on economic, social and political issues, government spending has become a major concern for researchers and scientists leading to different results and conclusions. With regard to the large share of governments in the economy of Middle East countries, there is the question: What is the impact of globalization on government spending in these economies? This study examines the impact of globalization on government spending in 12 countries in the Middle East using panel data methods for the period from 1995 to 2010. The indicator for globalization in this study is the KOF Index which has three dimensions including economic, political, and social. The method employed to estimate the model in this study is the generalized method of moments (GMM) using the Eviews software. The estimation results suggest that globalization has a significant positive impact on government spending such that with the advance of globalization, government spending will increase in the selected countries. Top Keywords Globalization, KOF Index, government spending, GMM method. Top |