The Performance of Public Investments During Fiscal Consolidation in Albania

Blerta Zilja () and Manjola Naco ()
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Blerta Zilja: Department of Accounting, Faculty of Economics, University of Tirana
Manjola Naco: Department of Accounting, Faculty of Economics, University of Tirana

Romanian Economic Journal, 2013, vol. 16, issue 48, 241-258

Abstract: Public Investments are generally accepted as one of the main factors which contribute in the economic growth of a country, despite that several studies bring evidences that these variables are not always strongly correlated to each other. However, the sensitivity of economic growth to Public Investments (PI) and the high level of budget funds spent from governments for capital expenditures have made the issue on PI in general and moreover the factors that influence on PI very important to researchers and public as well. This paper gives a broad insight of public investments performance in developed or developing countries over time, underlining several factors that have assessed this performance, focusing especially on the impact of fiscal consolidation. It brings the views of many authors over the fact whether the governments during fiscal consolidation, in order to control debt stock and the budget balance prefer to cut current expenditures or capital expenditures. Furthermore, it analyses how Albania has reacted during its periods of fiscal consolidation and which has been the behavior of different governments toward PI.

Keywords: public investment; current expenditures; fiscal consolidation (search for similar items in EconPapers)
JEL-codes: C54 H55 (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:rej:journl:v:16:y:2013:i:47:p:241-258

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