scholarly journals The structure of public spending and economic growth in Russia

2019 ◽  
Vol 5 (2) ◽  
pp. 154-176 ◽  
Author(s):  
Alexey Balaev
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
National Economy ◽  
Social Spending ◽  
National Defense ◽  
Structural Vector Autoregression ◽  
Fiscal Multipliers ◽  
General Government ◽  
Positive Effect ◽  
Structural Vector

This paper examines how Russia’s GDP growth responds to changes in the structure of general government spending. We consider models with expenditures as a percentage of total spending and expenditures as a percentage of GDP. Each model is constructed as a structural vector autoregression (SVAR). We show that redistribution in favor of productive expenditures (national economy, education, healthcare) increases the rate of economic growth, and an increase in the share of unproductive expenditures (national defense, social policy) reduces it. The maximum positive effect comes from expenditures on the national economy: their increase by 1% of GDP with constant total expenditures increases the growth rate of GDP by 1.1 p.p. An increase in expenditures on education by 1% of GDP with constant total expenses contributes +0.8 p.p. to the growth rate of GDP. The corresponding effect of healthcare expenditures is +0.1 p.p. Defense and social spending make negative contributions: –2.1 and –0.7 p.p. respectively. These results are consistent with existing estimates of fiscal multipliers for Russia and calculations based on data from other countries and cross-country data.

scholarly journals The Impact of Public Expenditure Structure on Economic Growth in Russia

2018 ◽  
Vol 13 (6) ◽  
pp. 8-35
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
National Economy ◽  
Positive Impact ◽  
Empirical Studies ◽  
Social Spending ◽  
Gdp Growth ◽  
Gdp Growth Rate ◽  
General Government ◽  
The Impact

In this paper we estimate the impact of changes in the structure of general government expenditure on GDP growth rate in Russia. We construct two types of models: with expenses as shares of total general government spending and as percentages of GDP. The structural vector autoregression (SVAR) methodology from [Corsetti et al., 2012] has been used. According to our estimates, an increase in the share of productive expenditures (national economy, education and health) has a positive impact on the rate of economic growth, while an increase of the share of non-productive expenditures (national defense and social policy) has a negative effect on the growth rate of GDP. The largest positive effect among productive expenditures belongs to expenditure on the national economy: increasing spending on the national economy by 1% of GDP while maintaining the total expenditure unchanged leads to an increase in GDP growth rate by 1.1 p.p. The second largest effect is produced by expenditure on education: a 1% of GDP increase in this expenditure with constant total spending leads to additional GDP growth of 0.8 p.p. Expenditure on health care has the least positive impact on growth: the effect of its increase is estimated at +0.1 p.p. to GDP growth rate. For defense and social spending the effect is negative: -2.1 p.p. and -0.7 p.p. respectively. The results obtained in this paper are generally consistent with the results in previous empirical studies for Russia based on fiscal multipliers, as well as results in empirical studies with foreign and international data.

Biotechnology Law in The Socialist Republic of Vietnam

2005 ◽  
Vol 2 (3) ◽  
Author(s):  
Sarah E. Hilmer
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
National Economy ◽  
Agricultural Production ◽  
Economic Liberalization ◽  
Structural Reforms ◽  
Socialist Republic ◽  
Communist State ◽  
Science Technology ◽  
The People

IntroductionThe communist state of Vietnam with its currently 64 provinces (tinh) and 5 municipalities (thu do), experienced little economic growth over the last two decades. This was a result of the more conservative leadership policies in the country. However, since 2001 Vietnamese authorities have committed to economic liberalization, whereby structural reforms were enacted, as well as the economy was modernized and the country produced more competitive, export-driven industries.With a population of approximately 82,689,518, over 70 % of the people are involved in agricultural production, such as paddy rice, corn, potatoes, rubber, soybeans, coffee, tea, bananas, sugar; pigs, and fish. Other active development of the country, besides agriculture, is considered to be industry with its imports and exports. The growth rate of the national economy is estimated of 7.2 % on average, and investments for science, technology and environmental protection can be seen as the major reasons of economic growth.

scholarly journals Russian budget structure efficiency: Empirical study

2018 ◽  
Vol 4 (3) ◽  
pp. 197-214 ◽  
Author(s):  
Alexey Kudrin ◽  
Alexander Knobel
Keyword(s):  
Economic Growth ◽  
Positive Influence ◽  
Public Expenditures ◽  
National Defense ◽  
Fiscal Multipliers ◽  
Svar Model ◽  
Economic Growth Rates ◽  
Empirical Methodology ◽  
Enforcement Activity

This paper investigates the economic efficiency of Russian public expenditures in 2002–2016 by estimation of their multiplicative impact on the GDP level and economic growth. We use the empirical methodology based on Corsetti et al. (2012). We estimate a number of fiscal multipliers: on national security, law-enforcement activity, national defense, education, health care and sport and road infrastructure. For assessing the influence of budget structure on long-term economic growth rates, we estimate the SVAR model in which GDP growth is a structural variable. The research shows a positive influence of budgetary resources redistribution from non-productive government expenditures to productive ones on economic development.

scholarly journals Domestic Debt and Economic Growth in Tanzania

2018 ◽  
Vol 1 (1) ◽  
pp. p207
Author(s):  
Josephat Lotto ◽  
Catherine T. Mmari
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
Gdp Growth ◽  
Gdp Growth Rate ◽  
Domestic Debt ◽  
Negative Effect ◽  
The Government ◽  
The Impact ◽  
The Relationship ◽  
Positive Effect

The main objective of this paper was to examine the impact of domestic debt on economic growth in Tanzania for the period 1990 to 2015 using Ordinary Least Square (OLS) regression method to estimate the effects. The study finds that there is an inverse but insignificant relationship between domestic debt and the economic growth of Tanzania as measured by GDP annual growth. The inverse relationship between domestic debt and GDP may be caused by different factors such as; increased trend in domestic borrowing, government lenders’ profile dominated by commercial banks and non-bank financial institutions which promotes the “crowding out” effect; the nature of the instruments used by the government ; the improper use of the domestic borrowed funds which may include funding budgetary deficits, paying up principal and matured obligations on debt, developing financial markets as well as fund other government operations. Other control variables relate with the GDP as predicted. For example, Inflation (INF) has a negative effect on the GDP growth rate, but the relationship is not statistically significant, while gross capital formation (GCF) has a positive statistically significant effect on GDP growth rate. Furthermore, foreign direct investment (FDI) showed a positive effect on the GDP growth rate and export (X) has a positive effect on GDP growth rate, and the relationship is statistically significant explaining that if a country applied an export-led growth economic strategy it enjoys the gains of participating in the world market. This means that an increase in export stimulates demand for goods which leads to increase in output, and as a country’s output increases, the economic performance also takes a similar trend. Finally, government expenditure (GE) had a negative effect on the GDP growth rate which may be explained by the increased government expenditures which are funded by either tax or borrowing. Therefore, what is required for countries like Tanzania is to have better debt management strategies as well as prudential financial management while maintaining to remain within the internationally acceptable debt level of 45% of GDP and maintain a GDP growth rate of not less than 5%. It is important for the country to realize from where to borrow from, the tenure, the risks involved and limitations to borrowing and thus set the right balance of combination of both kinds of debt. Another requirement is to properly utilize the borrowed funds. The central government’s objective should be to use the funds in more development-oriented projects that bring positive returns to the economic development.  The government should not only create a right environment and policies for investment to attract investment from domestic and foreign sources but also be cautious about the kind of investments that the foreign investors make.

scholarly journals Credit Market Development and Prictice Stability of National Economy

2019 ◽  
pp. 65-75
Author(s):  
Viktor A. Byvshev ◽  
Natalya E. Brovkina
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
National Economy ◽  
Credit Market ◽  
Market Development ◽  
Price Stability ◽  
Real Gdp ◽  
Social And Economic Development ◽  
The World ◽  
Economic Growth Rates

In recent years, the growth rate of the national economy does not meet the challenges of social and economic development of the country. An economic breakthrough is needed, accompanied by the achievement of economic growth rates that are faster than those of the world. However, it is important to maintain macroeconomic and price stability. One of the factors that can ensure the achievement of this goal is credit, the value of which, in our opinion, is currently unfairly underestimated. The publications of Russian and foreign economists confirm that credit is a factor contributing to economic growth. At the same time, the loan may be associated with the formation of inflation risks. The purpose of the article is to determine the ratio in which the development of the credit market, characterized, in particular, by an increase in lending to households and non-financial organizations, will not lead to a violation of the price stability of the national economy. The application of the system of econometric models allowed to reveal the ratio between the growth rate of loans to non-financial organizations and the growth rate of real GDP.

scholarly journals Size matters: measuring the effects of inequality and growth shocks

2020 ◽  
Keyword(s):  
Economic Growth ◽  
Income Inequality ◽  
Vector Autoregression ◽  
Structural Vector Autoregression ◽  
Short Term ◽  
Social Scientists ◽  
The Usa ◽  
The Relationship ◽  
Structural Vector

Understanding the relationship between income inequality and economic growth is of utmost importance to economists and social scientists. In this paper we use a Bayesian structural vector autoregression approach to estimate the relationship between inequality and growth via growth and inequality shocks for two large economies, China and the USA, for the years 1979–2018. We find that a growth shock is inequality-increasing, and an inequality shock is growth-reducing. We also find, however, that the sizes of the effects of these shocks are very small, accounting for under 2 per cent of the variance for both countries. Finally, we also find that the effects of the shocks dissipate within ten years, suggesting that the effects of these shocks are a short-term phenomenon.

scholarly journals Analysis of Portfolio Investment in Indonesia Macroeconomy

JEJAK ◽  
2020 ◽  
Vol 13 (2) ◽  
pp. 395-411
Author(s):  
Ihsan Bagus Atyantodito ◽  
Firmansyah Firmansyah
Keyword(s):  
Economic Growth ◽  
Financial Market ◽  
Impulse Response Function ◽  
Portfolio Investment ◽  
Structural Vector Autoregression ◽  
Vector Autoregression Model ◽  
Portfolio Flows ◽  
Financial Variables ◽  
Autoregression Model ◽  
Structural Vector

This research examines the cause of portfolio flows in Indonesia and the effect of portfolio flows to the Indonesian economy based on monetary policy approach. By analyze the interactions among portfolio investment, global and domestic macroeconomy, and financial variables by employing a structural vector autoregression model, this study finds: 1) that both global and domestic factors play the role in driving the portfolio flows in Indonesia; 2) the portfolio flows play the role in driving the domestic financial market, by the order starts from asset prices, followed by exchange rate and lastly credit; 3) the portfolio flows play a role in driving the Indonesian economic growth. The percentage of the effect of portfolio is relatively large compared to the other variables, but in total, the percentage of portfolio flows in driving the economic growth is quite small. Nonetheless, the impulse response function result shows that the shock in portfolio flow can affect the economic growth.

scholarly journals Local Effects from the Monetary Policy Globalization

2021 ◽  
Vol 6 (1) ◽  
pp. 21-27
Author(s):  
Oleksandr Bandura ◽  
Valeriia Tkachova
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
Monetary Policy ◽  
Foreign Exchange ◽  
National Economy ◽  
Local Level ◽  
Economic Growth Rate ◽  
Policy Effects ◽  
Us Economy ◽  
The Us

Most central banks of developed countries realize the “quantitative easing” (QE) monetary policy that allows us to speak about globalization as for monetary policy, as for this policy effects. We identified some positive and negative effects from the QE policy for the US economy (as the issuing country) and for Ukraine (as a country that accept of this policy effects on local level) that can be taking into account when national economy economic planning.At the base of author’s CMI-model of macroeconomic dynamics we proposed possible explanation for this monetary policy effects for the US economy that have no satisfied explanation within well-known models: 1) comparatively low economic growth rate under the QE monetary policy; 2) phenomenon of low inflation under sharp rising of money supply as a result of the QE policy; 3) phenomenon of record employment under comparatively small economic growth rate. Also we identified some other effects of the QE monetary policy that can be explained within well-known models. There are the following ones: negative interest rates for bonds market, the US dollar weakening on FOREX market, price rising for gold and various digital assets. We proposed some possible ways to use global effects from the QE monetary policy to benefit Ukrainian economy. For example, we proposed to change the structure of part of the gold and foreign exchange reserves of the National Bank of Ukraine (NBU) in order to increase its value, actually, under the risk-free way. We can use periods of the US economy stimulus provided by Federal Reserve Bank to increase part of gold in the reserves with corresponding decreasing of foreign exchange part. When the stimulus will be stopped, we proposed to decrease part of gold with corresponding increasing of foreign exchange part. Conclusions, tied with impact of the cumulative market imperfections value (ΔР) on economic growth rate obtained for the US economy, are valid and for Ukrainian economy, because, beforehand, we proved the validity of our CMI-model for national economy, too. JEL classification: E30, E31, E32, E37

Government investment fiscal multipliers: evidence from Euro-area countries

2021 ◽  
pp. 1-19
Author(s):  
Matteo Deleidi ◽  
Francesca Iafrate ◽  
Enrico Sergio Levrero
Keyword(s):  
Fiscal Policy ◽  
Euro Area ◽  
Government Expenditure ◽  
Structural Vector Autoregression ◽  
Government Investment ◽  
Fiscal Multipliers ◽  
Discretionary Fiscal Policy ◽  
The Government ◽  
Local Projections ◽  
Structural Vector

Abstract This paper aims to estimate the government investment fiscal multipliers in select European countries for the period 1970–2016. To do this, we combine Structural Vector Autoregression (SVAR) modeling with the Local Projections (LP) approach. We estimate models by also controlling for fiscal foresight, excluding the postcrisis period and distinguishing between Northern and Southern countries. Our findings suggest that an increase in government investment generates a “Keynesian effect” by engendering positive and permanent effects on the GDP level, even when government expenditure expectations are considered. Fiscal multipliers are close to 1 on impact and increase in the years after the implementation of a discretionary fiscal policy.

scholarly journals Services Export Diversification and Economic Growth

2020 ◽  
Author(s):  
SENA KIMM GNANGNON
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
International Trade ◽  
Trade Openness ◽  
Export Diversification ◽  
Generalized Methods Of Moments ◽  
Methods Of Moments ◽  
Export Specialization ◽  
Positive Effect ◽  
Trade Market

Abstract The present article investigates the effect of services export diversification on economic growth by relying on a sample of 131 countries over the period 1985-2014. The empirical results, based on the two-step system Generalized Methods of Moments (GMM), has suggested that services export diversification enhances economic growth in developing countries, whereas in High Income Countries (HICs), services export specialization promotes economic growth. Furthermore, services export diversification enhances economic growth as countries experience a rise in their services exports growth, with the magnitude of this positive effect increasing as the growth rate of services exports rises. Finally, services export diversification tends to be positively associated with economic growth, but as countries enjoy greater trade openness, they tend to enhance their services export specialization so as to enjoy higher economic growth. Interestingly, it is services export specialization that promotes economic growth as countries better integrate into the international trade market. One key message conveyed by the analysis is the importance of services export diversification (or concentration) for economic growth, including when countries further open up to international trade.

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