The optimal government size in the kingdom of Saudi Arabia: an ARDL bounds testing approach to cointegration

This study attempts to estimate the optimum government size in kingdom of Saudi Arabia (KSA) using annual data covering 1971–2019 period by applying linear and nonlinear Autoregressive Distributed Lag ARDL Model. The main focus is whether Armey curve valid for KSA. statistical diagnostic tests provide an evidence model adequacy that estimation results are reliable. Moreover, short-run revealed speed adjustment (?0.82) indicating it takes about 14 months correct toward long-run equilibrium due a shock. NARDL asymmetric relationship between expenditures economic growth. Further, positive shock has impact while negative reduces Based on results, 26.9 as share GDP, which greater than average (24.2) during period. such result, obvious room increase up optimal estimated study.