scholarly journals Dynamic Linkages between Social Expenditures and Economic Growth: the Most Important Conclusions for Central European Countries

2021 ◽  
Vol 24 (4) ◽  
pp. 7-21
Author(s):  
Tuncer Govdeli ◽  
Esra Karakuş Umar
Keyword(s):  
Economic Growth ◽  
The State ◽  
European Countries ◽  
Social Spending ◽  
Public Expenditures ◽  
Budget Deficits ◽  
Causality Analysis ◽  
Central European ◽  
Causality Relationship ◽  
Social Expenditures

The role of the state within the neoliberal system is discussed in the approaches developed for social expenditures. Accordingly, the question of whether the state should stand back or provide the support needed by individuals has shaped the literaturę on social expenditures. It is thought that the increase in social expenditures affects public expenditures, and public expenditures may indirectly cause budget deficits. In addition, it is said that there is a decrease in social spending during periods of economic growth. All these dilemmas show that the idea that the country needs both producers and consumers while realizing economic growth has been pushed into the background. Here, the analyses of the relationship between social spending and economic growth are the arguments for the accuracy of this assumption. The aim of this study is to empirically analyze the long-term relationship between the economic growth and social expenditures of eight Central European countries and the causality relationship for 1999 and 2019. In the empirical findings, the cointegration relationship was determined between economic growth and social spending. Based on the findings of the causality analysis, it has been concluded that there is a bidirectional causality relationship between economic growth and social expenditures. Policy proposals are given in the conclusion section of the article.

scholarly journals Revisiting the Environmental Kuznets Curve Hypothesis: A Case of Central Europe

Energies ◽  
2021 ◽  
Vol 14 (12) ◽  
pp. 3415
Author(s):  
Bartosz Jóźwik ◽  
Antonina-Victoria Gavryshkiv ◽  
Phouphet Kyophilavong ◽  
Lech Euzebiusz Gruszecki
Keyword(s):  
Economic Growth ◽  
Co2 Emissions ◽  
Central Europe ◽  
Environmental Kuznets Curve ◽  
European Countries ◽  
Kuznets Curve ◽  
The European Union ◽  
Ekc Hypothesis ◽  
Central European ◽  
Long Run

The rapid economic growth observed in Central European countries in the last thirty years has been the result of profound political changes and economic liberalization. This growth is partly connected with reducing carbon dioxide (CO2) emissions. However, the problem of CO2 emissions seems to remain unresolved. The aim of this paper is to test whether the Environmental Kuznets Curve (EKC) hypothesis holds true for Central European countries in an annual sample data that covers 1995–2016 in most countries. We examine cointegration by applying the Autoregressive Distributed Lag bound testing. This is the first study examining the relationship between CO2 emissions and economic growth in individual Central European countries from a long-run perspective, which allows the results to be compared. We confirmed the cointegration, but our estimates confirmed the EKC hypothesis only in Poland. It should also be noted that in all nine countries, energy consumption leads to increased CO2 emissions. The long-run elasticity ranges between 1.5 in Bulgaria and 2.0 in Croatia. We observed exceptionally low long-run elasticity in Estonia (0.49). Our findings suggest that to solve the environmental degradation problem in Central Europe, it is necessary to individualize the policies implemented in the European Union.

scholarly journals OPTIMAL INCENTIVES FOR ECONOMIC GROWTH IN CENTRAL EUROPEAN COUNTRIES: A MICRO APPROACH

2021 ◽  
Vol 10 (3) ◽  
pp. 9-31
Author(s):  
Mustafa Akan ◽  
Natalia Konovalova
Keyword(s):  
Economic Growth ◽  
Financial Crisis ◽  
Interest Rates ◽  
Negative Impact ◽  
Point Of View ◽  
European Countries ◽  
Central European ◽  
Specific Objective ◽  
Financial Crisis Of 2008 ◽  
Optimal Incentives

Financial crisis of 2008 and the ongoing pandemic are continuing to have a negative impact on the economies of all countries even tough interest rates have been decreased significantly. This paper attempted to view the problem from a micro point of view to suggest more effective incentives for growth. The specific objective of the study is to determine and examine the effects of these incentives on economic growth in Central European countries.

scholarly journals Identifying Causality Relationship between Energy Consumption and Economic Growth in Developed Countries

2017 ◽  
Vol 1 (2) ◽  
pp. 71 ◽  
Author(s):  
Hasan Dinçer ◽  
Serhat Yüksel ◽  
Zafer Adalı
Keyword(s):  
Economic Growth ◽  
Economic Development ◽  
Energy Consumption ◽  
Developed Countries ◽  
Annual Data ◽  
Causality Analysis ◽  
Panel Causality ◽  
Bidirectional Relationship ◽  
Causality Relationship ◽  
Economic Improvement

The main purpose of this study is to evaluate the causality relationship between energy consumption and economic growth for developed countries. Within this context, annual data of 22 developed countries was examined by using Dumitrescu Hurlin panel causality analysis. As a result, it was determined that that there is a bidirectional relationship between energy consumption and economic improvement for developed countries. This condition provides two different results. Firstly, energy consumption has an influence on economic development for these countries. While considering this result, it can be said that any limitation in energy consumption will restrict economic growth. Moreover, it was also concluded that level of economic growth is the main reason of energy consumption for developed countries. In other words, developed countries tend to have more energy consumption when their economies are growing.

scholarly journals UNRAVELING THE (INTRINSIC) LINKAGE BETWEEN SOCIAL SPENDING AND REGIONAL DEVELOPMENT: AN EMPIRICAL ANALYSIS FOR EUROPEAN UNION COUNTRIES

2021 ◽  
Vol 13 (1) ◽  
Author(s):  
Kostas RONTOS ◽  
Maria-Eleni SYRMALI ◽  
Luca SALVATI
Keyword(s):  
Impact Analysis ◽  
Wide Spectrum ◽  
Social Needs ◽  
Policy Implications ◽  
European Countries ◽  
Social Spending ◽  
Theoretical Approaches ◽  
Mediterranean Countries ◽  
Fiscal Austerity ◽  
Social Expenditures

Theoretical approaches and place-specific solutions are required to face with the intrinsic linkage between social welfare and macroeconomic stability in advanced economies, especially in Europe. In this regard, the 2007 recession has influenced extensively the wide spectrum of social policies applicable in the European Community. New socioeconomic divides emerged and fiscal austerity urged Member States to resettle policy discourses, advancing social needs in a more effective way. In line with this evidence, our commentary discusses recent literature and it outlines policy implications of different political, institutional and socioeconomic settings. By analyzing cross-country variations in the shape and extent of welfare policies at the European level, our study evaluates apparent (and latent) performances of welfare systems in a comparative perspective, with a specific focus on Southern European countries. The existence of a latent relationship between social policy expenditures (SPE) and per-capita GDP was demonstrated. However, social expenditures may differ for a given level of income: for instance, Latvia had a lower level of social expenditures given its income level. Italy, Greece, Spain and Portugal were clustered together displaying a lower share of social spending in the total GDP in respect with the remaining European countries. This comparison suggests how Mediterranean countries are institutionally fragile and with a moderately higher level of corruption in respect with North-western countries. The results of this work contribute to bridge the semantic dichotomy between theoretical approaches and empirical findings in socioeconomic policy impact analysis.

scholarly journals The granger causality relationship between human development and economic growth

2020 ◽  
Vol 9 (6) ◽  
pp. 143-153
Author(s):  
Serdar Ozturk ◽  
Seher Suluk
Keyword(s):  
Economic Growth ◽  
Human Development ◽  
Granger Causality ◽  
Human Development Index ◽  
Causality Analysis ◽  
Developed Country ◽  
Development Index ◽  
Granger Causality Analysis ◽  
Empirical Level ◽  
Causality Relationship

The Human Development Index (HDI), which measures a country’s human development level, considering the health, education and income indicators of countries has been published in the Human Development Report each year since 1990 by the United Nations Development Programme. Norway, which is a highly developed country, was at the top of the Human Development Index. Therefore, the aim of this study is to evaluate Norway’s human development performance. In this context, the relationship between human development and economic growth has been examined at empirical level for Norway for the period between 1990-2017. In the study, firstly, ADF and PP unit root tests were performed. Then, Granger causality analysis was applied. According to the results of Granger causality analysis there is a one-way causality relationship from human development to economic growth.

scholarly journals Examining the Validity of Wagner’s Law versus Keynesian Hypothesis: Evidence from Turkey’s Economy

2019 ◽  
Vol 66 (1) ◽  
pp. 117-130 ◽  
Author(s):  
Özcan Karahan ◽  
Olcay Çolak
Keyword(s):  
Economic Growth ◽  
Public Expenditures ◽  
Economic Policies ◽  
Wagner’S Law ◽  
Distributed Lag ◽  
Autoregressive Distributed Lag ◽  
Short Run ◽  
National Output ◽  
Causality Relationship ◽  
Wagner's Law

Abstract The direction of the causality relationship between public expenditures and economic growth is one of the most controversial issues of the literature, which also causes great disagreements in the design process of economic policies. There are two approaches to this subject, which are opposite each other and called “Wagner’s Law” and “Keynesian Hypothesis”. This paper aims to examine the validity of Wagner’s law and Keynesian proposition in Turkey using Autoregressive Distributed Lag (ARDL) model over the period of 1998-2016. The findings supported the “Keynesian Hypothesis”, which advocates a one-way causality relationship from public spending to national output. More specifically, the results of the study showed that the effect of public expenditures on economic growth was positive in the short term and negative in the long term. From an economic policy standpoint, it can be argued that policymakers can promote Turkish economic growth through expansionary fiscal policies in the short run.

Financial Globalization and Economic Growth

2020 ◽  
pp. 99-116
Author(s):  
Murat Gündüz
Keyword(s):  
Economic Growth ◽  
European Union ◽  
Developed Countries ◽  
Financial Globalization ◽  
The European Union ◽  
Causality Analysis ◽  
Causality Test ◽  
Causality Relationship ◽  
Using Data ◽  
The Relationship

The relationship between financial development and economic growth is one of the interesting topics of economic researches. Financial globalization is a term used to open up capital markets to the international arena and to capitalize on developed countries to developing countries. This chapter investigates the causality relationship between financial globalization and economic growth. In this study, the panel causality test of Emirmahmutoğlu and Kose (2011) was used for the European Union countries by using data from 1996-2016 period. According to the causality analysis conducted for the European Union, there is a causality from general financial globalization index to economic growth, from de facto financial globalization to economic growth and from economic growth to De jure financial globalization index.

A Causality Analysis of Economic Growth and Union Density in European Countries

Labour ◽  
2013 ◽  
Vol 27 (4) ◽  
pp. 421-442 ◽  
Author(s):  
Magali Jaoul-Grammare ◽  
Isabelle Terraz
Keyword(s):  
Economic Growth ◽  
Union Density ◽  
European Countries ◽  
Causality Analysis

Fact or fiction? Welfare cuts and fiscal adjustments

2013 ◽  
Vol 34 (1) ◽  
pp. 63-92 ◽  
Author(s):  
Georg Wenzelburger
Keyword(s):  
Economic Growth ◽  
Welfare State ◽  
Public Debt ◽  
Social Spending ◽  
Public Finances ◽  
Long Run ◽  
Fiscal Adjustments ◽  
Social Expenditures ◽  
Western Democracies ◽  
The Welfare State

AbstractGovernments in the industrialised western democracies have repeatedly been advised to curb the welfare state when adjusting public finances in order to stabilise public debt in the long run and to create economic growth. This recommendation has been founded on a vast body of research on fiscal adjustments, which has come to the conclusion that cutting social expenditures leads to expansionary and more sustainable budget consolidations. This paper adds to the existing literature suggesting a more nuanced view, which challenges the simplicity of the “cutting-welfare” advice: first, we find that whereas less social spending is indeed associated with expansionary and successful adjustments, this is not the case for overall welfare state generosity. Second, disaggregating the welfare state in its components reveals that a reduction of pension generosity is indeed related to successful adjustments whereas reducing unemployment generosity does not seem to play a major role.

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