scholarly journals Testing the Twin Deficit Hypothesis for Kyrgyzstan Economy

2015 ◽  
Author(s):  
Damira Baigonushova
Keyword(s):  
Open Economy ◽  
Budget Deficit ◽  
Government Expenditure ◽  
Trade Deficit ◽  
The State ◽  
Real Economy ◽  
Twin Deficits ◽  
State Budget ◽  
Vector Autoregressive ◽  
Model Technique

Twin deficits hypothesis suggests that there is a positive relationship between budget and current account deficits. The present study examines Twin Deficits Hypothesis over the period of 2005:01–20013:12 in Kyrgyzstan by using Vector Autoregressive Model technique. The results show that there are relationships between government expenditure, export and import. The causalities are from government expenditure to export and import. These results confirm the Keynesian view, which asserts the existence of twin deficits, meaning that the state budget deficit at weak real economy, in an open economy, increase imports, which is the cause of twin deficits in the economy of Kyrgyzstan. To solve the problem of twin deficits, the state must pursue an active foreign trade policy in addition to fiscal policy, as it is proven empirically the state budget deficit has a big impact on trade deficit, but not the main factor of trade deficit.

scholarly journals COMPONENTS OF THE BUDGET SYSTEM OF UKRAINE AS FACTORS OF FINANCIAL AND ECONOMIC SECURITY

2020 ◽  
Vol 1 (3) ◽  
pp. 29-34
Author(s):  
Oleh Holovko ◽  
Lilia Solomonova
Keyword(s):  
Public Debt ◽  
Financial Stability ◽  
Budget Deficit ◽  
Economic Security ◽  
The State ◽  
State Budget ◽  
Decentralization Reform ◽  
State Pension ◽  
Practical Recommendations ◽  
Budget System

The purpose of this study is to analyze the components of the budget system of Ukraine as factors of financial and economic security to identify negative trends in the context of the implementation of decentralization reform. It is proved that the research of this direction should start with the analysis of the conceptual apparatus and structural relationships between categories. At the top level of the hierarchy there is the category of national security of Ukraine, which, according to current legislation, means the protection of state sovereignty, constitutional order and other national interests of the country from real and potential threats. The category of financial and economic security is also often used in the scientific literature. Given the above classification, in this case we are talking about the financial security of the country as a factor of economic security. Methodology. To stimulate economic development, the practice of modern budget regulation provides for the presence of a planned deficit, which is a source of local and public debt. Depending on the areas of its financing, there are domestic and foreign, local and national debts. The relationship between the above indicators determines the level of budget security of the country, which is one of the most important factors of financial stability was identified in the work. Results. It is proved that, according to the results of the analysis, practical recommendations on budget policy of Ukraine as a factor of financial and economic security should take into account the following steps: against the background of growing social burden on the budget, it is necessary to continue the redistribution of budget funds in favour of the regions, which will increase their level of financial autonomy and reduce the amount of transfer payments; pursue a strict restriction policy to prevent the growth of the state budget deficit and uncontrolled increase in debt; the problem of pension provision increases the burden on the state budget every year. It is necessary to take measures to create a cumulative system of state and non-state pension insurance. Practical implications. The practical consequences prove that in 2016 the public debt of the consolidated budget of Ukraine reached a record 81% of GDP. However, effective economic and budgetary policy allowed to reduce it in 2019 to 50.3%, which was positive. Moreover, the share of external debt was 29.2%. The high budget deficit in 2020 will lead to an increase in debt to 58.7% of GDP, which offsets the previous positive changes. It is determined that at the beginning and at the end of the study period the expenditures of the pension system of Ukraine have been equal to about 10% of GDP. At the same time, financing from own revenues has decreased from 8% to 6%, which is negative. The most critical situation became after 2013, when this indicator began to decline rapidly, increasing the burden on the state budget. Value/originality of the work is an analysis of the components of the budget system of Ukraine as factors of financial and economic security, which in contrast to the existing ones is based on the need for further implementation of decentralization reform and allows to develop practical recommendations for budget regulation.

The Financial System Stability: The Essence, Vulnerability, Ways to Provide

2021 ◽  
pp. 81-90
Author(s):  
Yurii Lupenko ◽  
◽  
Yurii Radionov ◽  
◽  
◽  
...  
Keyword(s):  
Budget Deficit ◽  
Financial System ◽  
Decisive Role ◽  
The State ◽  
System Stability ◽  
State Budget ◽  
Internal Factors ◽  
Endogenous Factors ◽  
The Government ◽  
The Stability

The state financial system must function smoothly and respond promptly to destabilizing exogenous and endogenous factors that can arise at any time. Therefore, ensuring the financial system's stability and improving its mechanisms is an important component of public policy. The purpose of the article is to reveal the essence of the financial system's stability, identify internal factors of the financial vulnerability of Ukraine that may affect the effectiveness of the country's financial system, and find ways to overcome them. The content of the concept of "stability of the financial system" is revealed. It is established that the use of different terminology indicates the complexity and, at the same time, the versatility of this term. According to international experience, the country's central bank has a decisive role in assessing the stability of the financial system; in Ukraine, this function is performed by the National Bank of Ukraine. It was found that inefficient use of budget funds is one of the key factors in the financial system's vulnerability. The state of execution of the State Budget of Ukraine in 2020 is analyzed. It has been established that over the last decade, the budget has been executed with a deficit, and the existence of a significant budget deficit leads to a movement in the “debt spiral”. The Government borrows a significant amount of money to implement the budget, and therefore it is becoming increasingly difficult to attract them on reasonable terms. Failure to receive the funds leads to late spending. Thus, the budget deficit, public debt, and inefficient use of budget funds are the internal factors that increase the financial system's vulnerability and undermine its stability.

Twin deficits hypothesis in Bangladesh: an empirical investigation

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Sima Rani Dey ◽  
Mohammad Tareque
Keyword(s):  
Current Account ◽  
Budget Deficit ◽  
Good Governance ◽  
Current Account Deficit ◽  
Trade Deficit ◽  
Fiscal Deficit ◽  
Twin Deficits ◽  
Content Type ◽  
Long Run ◽  
The Current Account

PurposeThis study attempts to examine the twin deficits hypothesis for Bangladesh. Along with the traditional twin deficits hypothesis associated with the current account and fiscal deficit, the paper also explores the causal relationship between the trade deficit and fiscal deficit.Design/methodology/approachWe start with the investigation of the conventional twin deficit hypothesis employing autoregressive distributed lag (ARDL) bounds testing approach in a multivariate framework. Due to the absence of cointegration between the budget deficit and trade deficit, the study adopts a multivariate vector autoregressive (VAR) model to analyze the nexus.FindingsThe study supports the presence of the twin deficits hypothesis in Bangladesh, both in the short run and long run. Unidirectional causation running from the budget deficit to the current account deficit in the long run. The trade model also supports the twin deficit hypothesis, like the aforementioned current account model.Practical implicationsTherefore, the sustainable fiscal deficit is the key to maintain a stable current account deficit and trade deficit in Bangladesh.Originality/valueThe study incorporates the country risk indicators to address the governance issue while analyzing the models' deficit scenarios because good governance is an integral part of explaining the development outcome and failure of a country like Bangladesh.

IMPERATIVES AND RISKS OF THE STATE BORROWINGS’ ACCUMULATION

2018 ◽  
Vol 2018 (6) ◽  
pp. 26-43
Author(s):  
Vasyl KUDRYASHOV ◽  
Keyword(s):  
Fiscal Policy ◽  
Public Debt ◽  
Budget Deficit ◽  
Peak Load ◽  
Banking System ◽  
The State ◽  
State Budget ◽  
State Sector ◽  
Budget Support ◽  
Analysis Of Dynamics

Analysis of dynamics of indicators of the state and the state-guaranteed debt in Ukraine in recent years is carried out and imperatives of the growth of public debt are determined. It is found out that its primary factors were the expansion of financing of the state budget for budget support of the state sector of economy, banking system, as well as the financing of the budget deficit. It is concluded that the solving of such tasks was carried out under conditions of aggravation of financial risks, namely: revenue mobilization, attraction of an additional resource for the purpose of financing the budget deficit and deficit-debt adjustment, under-fulfilment of privatization plans, admission of high inflation, as well as depreciation of the national currency. It is noted that the growth of public debt was due to an increase in the state borrowings, which were used to repay obligations, cover the costs of conducting the active operations and shift part of the borrowings of corporations and institutions to the state budget. The conduct of active operations was aimed at providing the financial support to the state banks and state institutions, DGF and capitalization of some private banks. Changes in the volume of the state borrowings are disclosed in terms of the ratio of their internal and external components. The reasons and consequences of growth of costs of deficit-debt adjustment (active operations within the framework of the state budget) are determined. Under conditions of non-fulfillment of revenue plans from privatization of the state property, such a policy will lead to aggravation of fiscal risks (retention of high indicators of the state borrowings and debt financing at the expense of the NBU and the state banks). The policy of state borrowings (in terms of internal and external components) turned out to be inconsistent: sharp changes were allowed in attracting the resource from internal and external sources, and the implementation of debt policy was marked by significant peak load on the state budget as well as their high profitability both in domestic and foreign markets. The volume of loan servicing continued to grow, which became a factor of increasing budget expenditures. Financing of borrowings using the resources of the NBU and the state-owned banks were reaching high rates. The author proposes the directions of fiscal policy aimed at restraining and restricting the state and the state-guaranteed debt by introducing changes to fiscal policy in Ukraine.

EFFECTS OF A PUBLIC DEBT AND DEFICIT BUDGET

2018 ◽  
Vol 8 (2) ◽  
pp. 140-144
Author(s):  
Daniel Szybowski
Keyword(s):  
Economic Development ◽  
Public Debt ◽  
Budget Deficit ◽  
Foreign Capital ◽  
The State ◽  
Financial Policy ◽  
Foreign Investments ◽  
State Budget ◽  
The Public ◽  
High Level

The aim of the article is to present a problem concerning the effects of the public debt and the budget deficit. The public debt is a result of the lack of adequate income earned by the financial sector, what means that it must incur liabilities to be able to carry out its tasks or improper management of the state budget funds - what results in the budget deficit. The size of the state's debt and the public debt has a very large impact on the socio-economic situa-tion of the country as well as on its financial policy. Due to the high indebtedness of the state, the whole economy is disturbed, the state authorities are not able to allocate an adequate amount of the funds to stimulate invest-ments. Such actions slow down the dynamics of economic development, what means that the state authorities most often look for savings. Unfortunately, this usually happens at the expense of the ordinary(?) citizens. Countries that have a high level of the debts tend to lose their credibility internationally. This may result in the fall in the foreign investments and the outflow of the foreign capital.

scholarly journals Factors affecting the economic growth in the Mekong Delta

2015 ◽  
Vol 5 (2) ◽  
Author(s):  
Nguyen Kim Phuoc
Keyword(s):  
Economic Growth ◽  
Economic Crisis ◽  
Open Economy ◽  
Mekong Delta ◽  
Secondary Data ◽  
Private Investment ◽  
The State ◽  
State Budget ◽  
Factors Affecting ◽  
Research Findings

The objective of the study is to find out factors affecting the economic growth (GDP) of the 13 provinces/cities in the Mekong Delta. The study used secondary data from Statistical Yearbook of Statistical Office of 13 provinces cities in the Mekong Delta in the period of 2005-2014 . The study included 12 independent variables which impact on the ability of the local GDP method, which has turned "economic crisis" to a dummy variable. With technical analysis panel regression, regression of GDP variables is made by macro factors and local characteristics. This study has found that the elements of economic crisis had a stronger impact and adverse effects on GDP. In addition, factors such as the state capital, private investment in the country, the situation of balancing the state budget revenues and expenditures, the open economy, inflation, and the total workforce retail sales also affect GDP. In particular, most of the variables are affected in the same way except two variables GDP which is inflation and balance of payment of the state budget (mixed impacts). From the research findings, some recommendations are proposed to promote economic growth of the Mekong Delta.

scholarly journals Magyarország konvergencia programja és a világgazdasági válság

2009 ◽  
Vol 4 (1) ◽  
pp. 29-32
Author(s):  
János Gősi
Keyword(s):  
Economic Crisis ◽  
The State ◽  
Real Economy ◽  
State Budget ◽  
The World ◽  
World Economic ◽  
World Economic Crisis

The convergence program of Hungary and the world economic crisis. The international financial and real economy crisis reached Hungary in the autumn of 2008, too. The crisis made the completion of the 2009. yearly state budget difficult very much and the continuation of the convergence program according to its plan, because the balance of the state budget is decaying because of the economical recession.

scholarly journals LEGAL MEANS AND INSTRUMENTS OF REGULATION ECONOMIC RELATIONS IN UKRAINE

2021 ◽  
pp. 45-50
Author(s):  
I.S. Pyroha ◽  
S.S. Pyroha
Keyword(s):  
Economic Development ◽  
Exchange Rate ◽  
Budget Deficit ◽  
Domestic Market ◽  
The State ◽  
Main Element ◽  
State Budget ◽  
Economic Relations ◽  
The Exchange Rate ◽  
The Stability

The paper investigates the most optimal forms and methods of legal influence on public relations in the field of economics. The absence of the main element of the economic mechanism – competition requires a proper assessment of the causes of existing problems, the right choice and the optimal set of means of influencing economic relations in order to accelerate the socio-economic development of Ukraine. Among the numerous legal problems of state regulation of the socio-economic sphere, two are identified, which are interdependent – ensuring the stability of the hryvnia exchange rate and increasing the share of goods of own production in the domestic market. To ensure the stability of the hryvnia exchange rate, the need to fix it for a long time with the establishment of an allowable range of fluctuations, in which the exchange rate changes in both directions with equal probability, is substantiated. The devaluation of the exchange rate should not be planned in the State Budget and used as a way to hide its actual deficit. The real budget deficit should be determined by the sum of the percentage of hryvnia devaluation and the percentage of the planned direct budget deficit. The hryvnia exchange rate should not be fixed in the State Budget, as such a provision of the law releases the National Bank of Ukraine from the constitutional obligation to ensure the stability of the hryvnia exchange rate provided for in Art. 99 of the Constitution of Ukraine. The means of maintaining a stable hryvnia exchange rate is to increase the share of goods / services of own production in the domestic market and to reach the minimum critical level of 50% within one or two years. To assess the achieved level, it is not necessary to use statistical indicators, but only the actual amounts of VAT contributed to the budget received from the sale of goods / services. Achieving the proposed level involves the transition to innovation and investment model of economic development. Two own sources of investment are proposed – the introduction of a new tax on exported capital and the forced legalization of capital exported from Ukraine earlier.

scholarly journals EFFECT OF A BUDGET DEFICIT ON INFLATION RATE IN VIETNAM

2017 ◽  
Vol 126 (5B) ◽  
pp. 117
Author(s):  
Nguyễn Thị Thùy Minh ◽  
Nguyễn Thị Thùy Dương
Keyword(s):  
Economic Growth ◽  
Growth Rate ◽  
Budget Deficit ◽  
Inflation Rate ◽  
Public Expenditure ◽  
The State ◽  
State Budget ◽  
Economic Growth Rate ◽  
Dialectical Relationship ◽  
The Relationship

<p>In recent years, Vietnam has achieved high economic growth rate so inflation has become a noticeable problem. The relationship between state budget deficit and inflation is a two-way dialectical relationship. However, within the limit of this article, the author only studies one-way relationship, the effect of budget deficit on inflation rate in Vietnam. Prolonged budget deficit and the remediation of the state budget deficit by different methods have affected the inflation rate on different degrees. This effect is analyzed by many approaches, both quantitative and qualitative, and includes five approaches: impact of fiscal policy inflation, impact of the state budget deficit level on inflation, impact of budget deficit funding on inflation, independence of monetary policy and its effect on inflation, effect of public expenditure on inflation.</p>

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