Regional Disparities and Fiscal Policy Challenges in Romania's Economic Growth Trajectory

Daniel Stadoleanu and Mihaela Neculita
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Daniel Stadoleanu: Dunarea de Jos University of Galati, Romania
Mihaela Neculita: Dunarea de Jos University of Galati, Romania

Economics and Applied Informatics, 2025, issue 2, 134-138

Abstract: This paper investigates the relationship between fiscal policy and regional economic growth disparities in Romania, a country characterized by persistent territorial imbalances. While regional convergence remains a strategic objective of national and European policies, fiscal instruments have not always been effectively tailored to address local structural challenges. The study proposes a conceptual and methodological framework that integrates both the direct and indirect effects of fiscal policy on regional performance. The theoretical model developed in this research emphasizes two primary transmission mechanisms. The productive-budgetary channel, through public investment in infrastructure, health, or education, and the fiscal incentive channel, through tax burden adjustments that influence private investment and entrepreneurial dynamics. To reflect this dual influence, the model incorporates key fiscal variables, structural factors, and macroeconomic control variables. By constructing a multidimensional model rooted in contemporary economic literature, the study lays the groundwork for empirical testing of the hypothesis that differentiated fiscal policy, when adapted to regional realities, can reduce economic disparities and foster sustainable development. The framework contributes to ongoing policy debates by offering a theoretically robust basis for designing fiscal interventions that promote regional convergence in Romania.

Keywords: regional disparities; fiscal policy; economic growth; regional convergence; public investment; territorial development (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ddj:fseeai:y:2025:i:2:p:134-138

DOI: 10.35219/eai15840409520

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