Abstract
This study aims at measuring the impact of government expenditure (current and capital) on credit granted to the
private sector in Jordan during the period (2002-2021). This study is based on theoretical, descriptive and econometrics
analysis using Vector Error Correction Method (VECM) methodology.
The study aims at studying the impact of independent variables (capital expenditures, military expenditures, expenditure
on public debt interest, and compensation of employees) on the dependent variable of credit granted to the private
sector. The VECM methodology was used. The study found a long-term inverse relationship between (capital expenditures,
and expenditure on public debt interest) towards credit granted to the private sector. It also showed a long-term
positive relationship between (compensation of employees, and military expenditures) towards the credit granted to the
private sector.