There are a lot of studies have been done about the effect of government expenditure on privat consumtion. However, they use times series data for a single country to estimate that relationship. This study use Generalized Method of Moment( GGM) which allows to correct for simultaneity and heterogeneity problem. The study samples are 14 Islamic countries that continually run budget deficit and have high debt ratio, which are more than 40 percent of GDP for that country. The result shows that goverment expenditure become complement to privat consumption.<\/p>\n","protected":false},"template":"","tags":[488,180,698,699,700],"jel-code":[],"article-type":[1329],"class_list":["entry","author-jem","post-4378","article","type-article","status-publish","tag-consumption","tag-gmm","tag-goverment-expenditure","tag-gross-domestic-product","tag-islamic-countries","article-type-normal-article"],"yoast_head":"\n