%0 Journal Article %T Non-Linear Effects of Government Size on Inflation in OPEC Countries: A Threshold Panel Approach %J Iranian Economic Review %I University of Tehran %Z 1026-6542 %A Nademi, Younes %A Winker, Peter %D 2022 %\ 03/01/2022 %V 26 %N 1 %P 199-214 %! Non-Linear Effects of Government Size on Inflation in OPEC Countries: A Threshold Panel Approach %K Inflation %K Government Size %K Threshold Panel Models %K OPEC Countries %R 10.22059/ier.2022.86979 %X The purpose of this paper is to consider the relationship between inflation and government size in OPEC countries during the period 2000-2015. Estimation results from different linear panel models with quadratic form of government size and non-linear panel models including static and dynamic panel threshold models suggest that there is a non-linear relationship between government size and the inflation rate in these countries. The threshold value of government size is estimated as 17.76% for all the threshold panel models with different control variables. Below this threshold value, an increase in government size has a significant negative impact on the inflation rate. When government size grows larger, an increasing government size has a significant positive impact on the inflation rate. This paper suggests that it is possible to explain the contradictory evidence of previous studies by making use of a non-linear model. %U https://ier.ut.ac.ir/article_86979_b4302fa829b4e8c8785204c0c785c84d.pdf