Economics at your fingertips  

Examining the impact of government spending on the finance-growth nexus: evidence from post-communist economies

Hazwan Haini and Pang Wei Loon

Post-Communist Economies, 2022, vol. 34, issue 6, 756-778

Abstract: This study examines the impact of government spending on the finance-growth nexus in 27 post-communist economies from 1995 to 2017 using dynamic panel estimators. Many transitional economies have attempted to reduce the influence of government intervention during their early transitional period while reforming their respective financial sectors. The findings show that overall financial development is positive to growth, while government spending has a negative impact on growth. More importantly, the marginal effects of financial development are positive to growth at low levels of government spending. In contrast, at high levels of government spending, financial development has a negative relationship to growth. Focusing on different aspects of financial development, the findings show that financial access and efficiency are more effective at stimulating growth compared to financial depth. Post-communist economies should ensure that government spending should not crowd out the financial sector, and promote financial efficiency and accessibility.

Date: 2022
References: Add references at CitEc
Citations: Track citations by RSS feed

Downloads: (external link) (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from

DOI: 10.1080/14631377.2021.2006491

Access Statistics for this article

Post-Communist Economies is currently edited by Roger Clarke

More articles in Post-Communist Economies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().

Page updated 2023-04-10
Handle: RePEc:taf:pocoec:v:34:y:2022:i:6:p:756-778