Size and quality of public sector and economic growth changes occurring in the former communist EU countries

Laura Obreja-Brasoveanu ()
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Laura Obreja-Brasoveanu: Universidade Portucalense
Authors registered in the RePEc Author Service: Laura Obreja Brasoveanu ()

No 17/2011, Working Papers from Universidade Portucalense, Centro de Investigação em Gestão e Economia (CIGE)

Abstract: The impact of fiscal policy on economic growth is a complex and contradictory topic in finance debates. Government influences real economy through the impact of public revenues and expenditures on the quantity and quality of production factors, labor and capital. High taxation for supporting big public sector can impede growth. On the other hand, some of the public expenditures can stimulate growth. These opposite effects of the public sector’s intervention through fiscal policy raise the debate about the performance of public sector in stimulating economic growth. The size and the quality of public sector is a reflection of the past and current political decisions. Ex-communist countries face the challenge of reconstructing the public sector, in order to correspond to the requirements of the market economy, but also to ensure a stable macroeconomic and social environment. The aim of this paper is to analyze the differences between developed EU countries and former communist EU countries regarding the public sectors and economic growth.

Keywords: fiscal policy; size of public sector; quality of public sector; economic growth (search for similar items in EconPapers)
JEL-codes: E62 H11 O10 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2011-05-30
New Economics Papers: this item is included in nep-mac and nep-tra
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Citations: View citations in EconPapers (1)

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