Dynamics of Public Expenditure on Defense and Economic Growth Pattern in Developed and Developing Countries

2021 ◽  
pp. 669-681
Author(s):  
Madhabendra Sinha ◽  
Anjan Ray Chaudhury ◽  
Partha Pratim Sengupta
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Public Expenditure ◽  
Positive Impact ◽  
Public Spending ◽  
Developed Countries ◽  
Panel Var ◽  
Dynamic Relationship ◽  
Panel Data Regression ◽  
Using Data

Endogenous growth theories refer that public spending has a considerable bearing on economic growth. Rise in public spending retards rate of economic growth. As the economic structure across the developed and developing countries varies significantly, the effect of public spending on non-productive activities may differ across these countries. In this context, the authors develop a comparative study for looking at the dynamic relationship between public expenditure on defense activities and pattern of economic growth between developing and developed countries across the globe over the period 1960-2015. Using data from SIPRI and World Bank, the authors invoke the panel data regression with panel co-integration test followed by panel VAR. Findings indicate that developed countries have positive impact of defense spending on growth, and the relationship is bi-directional, whereas the impact is found to be negative in developing nations.

Dynamics of Public Expenditure on Defense and Economic Growth Pattern in Developed and Developing Countries

2018 ◽  
pp. 131-143 ◽  
Author(s):  
Madhabendra Sinha ◽  
Anjan Ray Chaudhury ◽  
Partha Pratim Sengupta
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Public Expenditure ◽  
Positive Impact ◽  
Public Spending ◽  
Developed Countries ◽  
Panel Var ◽  
Dynamic Relationship ◽  
Panel Data Regression ◽  
Using Data

Endogenous growth theories refer that public spending has a considerable bearing on economic growth. Rise in public spending retards rate of economic growth. As the economic structure across the developed and developing countries varies significantly, the effect of public spending on non-productive activities may differ across these countries. In this context, the authors develop a comparative study for looking at the dynamic relationship between public expenditure on defense activities and pattern of economic growth between developing and developed countries across the globe over the period 1960-2015. Using data from SIPRI and World Bank, the authors invoke the panel data regression with panel co-integration test followed by panel VAR. Findings indicate that developed countries have positive impact of defense spending on growth, and the relationship is bi-directional, whereas the impact is found to be negative in developing nations.

scholarly journals THE NEXUS BETWEEN PUBLIC SPENDING ON EDUCATION AND ECONOMIC GROWTH OF KOSOVO – ECONOMETRIC APPROACH

2020 ◽  
Author(s):  
Besime Ziberi ◽  
Mimoza Hodaj
Keyword(s):  
Higher Education ◽  
Economic Growth ◽  
Secondary Education ◽  
Public Expenditure ◽  
Positive Impact ◽  
Pearson Correlation ◽  
Public Spending ◽  
Secondary Data ◽  
State Budget ◽  
The Impact

The main aim of this study is to analyze the trend of public spending dedicated to education in case of Kosovo over the years and to measure the impact of public spending in education on economic growth of Kosovo. In order to achieve the goal, the Pearson Correlation is used and a multifactorial regression model (OLS) has been modified and adapted, where we have determined the Gross Domestic Product (GDP) as depended variable and as independent variable in the model conclude: (i) Total public expenditure on education (ii) Public expenditure on Secondary Education and (iii) Public expenditure on Higher Education (University). The data used is secondary data from the Kosovo’s State Budget, Ministry of Finance and Transfers, and Kosovo Agency of Statistics. We come in conclusion that public spending dedicated to the Higher Education (University) has a positive impact on Kosovo's economic growth meanwhile the public spending on secondary education and total public expenditure on education in the model circumstances show no significance. The paper comes with further recommendations on public spending policies dedicated to education in order to influence Kosovo's economic growth.

scholarly journals The Nexus Between Public Spending on Education and Economic Growth of Kosovo (Econometric Approach)

2020 ◽  
Vol 34 (1) ◽  
pp. 285-296
Author(s):  
Besime Ziberi ◽  
Rrezarta Gashi ◽  
Mimoza Hodaj
Keyword(s):  
Higher Education ◽  
Economic Growth ◽  
Secondary Education ◽  
Public Expenditure ◽  
Positive Impact ◽  
Pearson Correlation ◽  
Public Spending ◽  
Secondary Data ◽  
State Budget ◽  
The Impact

Abstract The main aim of this study is to analyse the trend of public spending dedicated to education in case of Kosovo over the years and to measure the impact of public spending in education on economic growth of Kosovo. In order to achieve the aim, the Pearson Correlation has been used and a multifactorial regression model (OLS) has been modified and adapted, where we have determined the Gross Domestic Product (GDP) as a dependent variable and as an independent variable in the model: (i) Public expenditure on secondary education and (ii) Public expenditure on higher education (university). The data used are secondary data from the Kosovo’s State Budget, Ministry of Finance and Transfers, and Kosovo Agency of Statistics. We have come to a conclusion that public spending dedicated to higher education (university) has a positive impact on Kosovo’s economic growth meanwhile public spending on secondary education does not show any effect. The paper suggests further recommendations on public spending policies dedicated to education in order to influence Kosovo’s economic growth.

The Impact of FDI Inflows and Outflows on Economic Growth: An Empirical Study of some Developed and Developing Countries

2019 ◽  
Vol 6 (1) ◽  
pp. 129-157
Author(s):  
Younis Ali Ahmed ◽  
Roshna Ramzi Ibrahim
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Panel Data ◽  
Fixed Effects ◽  
Positive Impact ◽  
Developed Countries ◽  
Fdi Inflows ◽  
Panel Data Estimation ◽  
The Impact ◽  
Data Estimation

FDI is an investment including a long-term relationship and reflecting a lasting interest and control of a resident entity in one economy. FDI is a combination of capital, technology, marketing and management. Based on the Neoclassical, Exogenous and modern theories FDI has a positive role in accelerating economic growth and development. Many countries are improving their economy in order to attract FDI.  The main objective of this study is to examine the impact of FDI inflows and outflows on economic growth of developed countries such as (USA, UK and France) and developing countries such as (Malaysia, Turkey and Iran) from (1980 to 2017). To accomplish that, ARDL approach and panel data estimation were used. The empirical findings reveal that the FDI inflows and outflows for developed countries (US and UK) have a positive impact on economic growth (GDP), while the FDI inflows of France have a negative impact. Nevertheless, FDI inflows and outflows for developing countries of (Malaysia, Turkey, and Iran) have a positive impact on economic growth. The result of panel data estimation shows that Fixed effects model is appropriate for estimating the parameters. In conclusion, Developing countries should diversify their FDI inflows and outflows to cover all the sectors and they should benefit from the developed countries’ experiences with higher impact of FDI on economic growth.

Globalizzazione ed equitŕ distributiva: il ruolo del mercato e delle scelte politiche

2009 ◽  
pp. 5-22
Author(s):  
Franco Reviglio
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Positive Impact ◽  
Developed Countries ◽  
Industrial Workers ◽  
Equity Issue ◽  
Main Determinant ◽  
Unskilled Workers ◽  
Political Choices ◽  
Skilled And Unskilled Workers

- Is globalisation the main determinant of the world's increasing inequity? Globalisation raises world welfare through increases in trade pushing economic growth and reducing poverty, but it worsens income discrepancies between skilled and unskilled workers in developed countries and between industrial workers and peasants in developing countries. Moreover, it does not benefit the poor living in countries that stay outside of the positive impact of globalisation on economic growth. As shown by the economic literature, the market is not responsible for income inequities, because it is neutral from the distributive side. The answer to the challenging equity issue is not protectionism built on barriers to trade and to the liberalisation process, but the adoption of political choices aimed at correcting income inequities both in developed and developing countries. JEL A1, D3, E6, F0, O1

scholarly journals The Dynamic Relationship between Inequality and Sustainable Economic Growth

2020 ◽  
Vol 12 (14) ◽  
pp. 5740 ◽  
Author(s):  
Hwan-Joo Seo ◽  
HanSung Kim ◽  
Young Soo Lee
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Income Inequality ◽  
Growth Model ◽  
Capital Accumulation ◽  
Negative Impact ◽  
Positive Impact ◽  
Dynamic Relationship ◽  
Negative Effect ◽  
Sustainable Economic Growth

This study empirically tests the effects of income inequality on growth for 43 countries from 1991 to 2014 based on a cumulative growth model. The results show that, first, the estimation results using a reduced equation reveal a positive correlation between the income inequalities of lagging countries and the respective growth gaps with the frontier country. This confirms that the increase in income inequality negatively affects growth. Secondly, a cumulative growth model using 3SLS estimation shows that income inequality has a negative effect only on investment. However, we fail to find correlations between technological innovation and income inequality and between human capital accumulation and income inequality. Considering that investment has a positive impact on productivity, we conclude that income inequality has a negative impact on investment and that the resulting sluggish investment has a negative impact on productivity, which in turn negatively influences growth. Third, contrary to Kaldor and Barro’s prediction, we find that income inequality in developing countries is negatively correlated with growth, particularly for investment. The effects of income inequality on investment are found to be similar in both developed and developing countries. We also find region-specific differences in the paths through which income inequality affects sustainable economic growth.

Public Expenditure and Economic Growth: Evidence from the Developing Countries

2020 ◽  
Vol 9 (3) ◽  
pp. 228-236
Author(s):  
Deepti Ahuja ◽  
Deepak Pandit
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Public Expenditure ◽  
Trade Openness ◽  
Government Expenditure ◽  
Public Spending ◽  
Set Covering ◽  
Control Variables ◽  
Data Set ◽  
The Relationship

Regardless of theoretical grounds that presumed a positive relationship between government spending and economic growth, the extant research on this nexus is inclusive. This article re-examines the relationship between public expenditure and economic growth using more copious panel data set covering 59 countries in 1990–2019. Our empirical results confirm the unidirectional causality between economic growth and government expenditure where the causation runs between public spending and GDP growth. The results at large support the Keynesian framework that asserts the importance of government expenditure in stimulating economic growth. Further, the analysis reveals that after considering all the control variables such as trade accessibility, investment and inflation public spending positively affects economic growth. With regards to control variables, it was found that investment has a significant and positive bearing on economic growth. Evidence from the regression estimates further displays that trade openness encourages evolution in developing countries. However, population growth and unemployment have a detrimental effect on economic growth.

scholarly journals Efficient and Effective Public Spending for Sustainable Economic Growth

2015 ◽  
Author(s):  
Asel Azhykulova
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Public Sector ◽  
Public Spending ◽  
Developed Countries ◽  
Public Budget ◽  
Size Of Government ◽  
Use Of Resources ◽  
Efficiency And Effectiveness ◽  
The Government

Nowadays, governments are more careful with the use of resources and attempt to be efficient and effective to achieve sustainable economic development. This paper contrasts the efficiency and effectiveness of public spending of developed and developing countries in current conditions and their impact on economic growth. The author analyses efficiency and effectiveness measures of public spending applied by prominent cross-country empirical studies. The critical success factors for the effective performance of government through World Bank indicator of government effectiveness highlights the role of effective public budget policy. In addition, the Public Sector Performance Index and Public Sector Efficiency Index introduced by Vito Tanzi and other measures of Livio di Matteo, Konstantinos Angelopoulos are examined. Based on these approaches the author proposes several suggestions for the current condition of public budget policies of Central Asian countries and ways of improving the effectiveness and efficiency levels of their public sector. The author argues that the assumption that developing countries are less efficient than developed countries are based on several efficiency variations: the size of government expenditure, a government budget composition, aid dependency, and weak institutions. What is more, findings suggest that countries with relatively small governments that use resources more efficiently tend to achieve higher levels of economic growth that is not always the case for all developed countries. These findings have important implications for assessing the government performance on economic growth.

Analysis of Major Problems Faced by Small Firms in North India

2015 ◽  
Vol 15 ◽  
pp. 150-160
Author(s):  
Davinder Singh ◽  
Jaimal Singh Khamba ◽  
Tarun Nanda
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Economic Development ◽  
Small Firms ◽  
Small And Medium Enterprises ◽  
Developed Countries ◽  
North India ◽  
Small Enterprises ◽  
Employment Generation ◽  
Medium Enterprises

Micro, Small and Medium Enterprises (MSMEs) have been noted to play a significant role in promoting economic growth in less developed countries, developing and also in developed countries. Worldwide, the micro and small enterprises have been accepted as the engine of economic growth of any nation. Small and Medium Enterprises are the backbone of the economies, because it trigger employment, output, export, poverty alleviation, economic empowerment, economic development etc. in developed as well as in developing countries. It is more important to developing countries as the poverty and unemployment are burning problems. MSMEs have been playing a momentous role in overall economic development of a country like India where millions of people are unemployed or underemployed. Therefore, the growth of small sectors is essential for the growth in the GDP, employment generation, total manufacturing production and export. India, being one of the fastest growing economies of the world, needs to pay an honest attention for the utmost growth of MSMEs for its increased contribution in above areas.

scholarly journals How Do Budget Deficits and Economic Growth Affect Reelection Prospects? Evidence from a Large Panel of Countries

2008 ◽  
Vol 98 (5) ◽  
pp. 2203-2220 ◽  
Author(s):  
Adi Brender ◽  
Allan Drazen
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Fiscal Policy ◽  
Growth Rates ◽  
Electoral System ◽  
Developed Countries ◽  
Economic Conditions ◽  
New Democracies ◽  
Budget Deficits ◽  
Large Panel

We test whether good economic conditions and expansionary fiscal policy help incumbents get reelected in a large panel of democracies. We find no evidence that deficits help reelection in any group of countries independent of income level, level of democracy, or government or electoral system. In developed countries and old democracies, deficits in election years or over the term of office reduce reelection probabilities. Higher growth rates over the term raise reelection probabilities only in developing countries and new democracies. Low inflation is rewarded by voters only in developed countries. These effects are both statistically significant and quite substantial quantitatively. (JEL D72, E62, H62, O47)

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