FISCAL POLICY AND INSTITUTIONAL BUDGET ARCHITECTONICS

##plugins.themes.bootstrap3.article.main##

##plugins.themes.bootstrap3.article.sidebar##

Published: Dec 26, 2019

Abstract

The purpose of the article is to study the role of fiscal policy in the context of the development of institutional budget architectonics aimed at ensuring macroeconomic stability, boosting economic growth, strengthening human potential, improving public welfare and defining approaches to its formation in advanced and transition economies. Comparative and factor methods make it possible to cover the peculiarities of institutional environment of the formation of fiscal policy in EU countries and Ukraine in the context of the development of the institutional budget architectonics and to identify ways for its improvement. Methodology. Substantiation of the role of fiscal policy in terms of the development of institutional budget architectonics, determination of its strategic orientations are based on generalization and systematization of experience of advanced and transition economies. For this very reason, the authors analyse and assess the fiscal policy and define special aspects of the formation and implementation of its components in relevant countries. Results show that to increase the effectiveness of the fiscal policy, it is expedient to ensure its interrelation with other components of financial policy based on a combination of fiscal and motivation function. Effective institutional budget architectonics provides means for creating conditions for sustainable economic growth, achieving strategic goals of socio-economic development of the country. Significant tasks of the development of institutional budget architectonics are regulation of the ratio between direct and indirect tax revenues, the structure of budget expenditures in terms of functional, economic classifications, maintaining the budget gap and public debt at the level that contributes to the financial and economic stability of the country, taking into account economic cyclical nature. Practical implications. A feasible budget architectonics would facilitate the maintenance of macroeconomic stability and accelerate economic growth. It is expedient to carry out institutional changes of budget architectonics on the ground of dynamic interconnection of budget and macroeconomic indicators. Value/originality. Fiscal policy plays a significant part in the process of government regulation of socio-economic development of the country. Elaboration of fiscal policy approaches in the context of the development of institutional budget architectonics is an important prerequisite for improving the quality of budget planning, ensuring the strength, stability and dynamic balance of the budget system. It is advantageous to introduce adaptive institutional changes into the budget architectonics in order to accelerate economic growth. Therefore, the article covers the essence and role of institutional budget architectonics aimed at ensuring macroeconomic stability, accelerating economic growth, developing human potential, improving public welfare; it defines the approaches to its development in transition and advanced economies. The authors establish that effective fiscal policy based on feasible institutional budget architectonics provides means for creating conditions for sustainable economic growth, achieving strategic goals of socio-economic development of the country.

How to Cite

Chugunov, I., Makohon, V., & Krykun, T. (2019). FISCAL POLICY AND INSTITUTIONAL BUDGET ARCHITECTONICS. Baltic Journal of Economic Studies, 5(5), 197-203. https://doi.org/10.30525/2256-0742/2019-5-5-197-203
Article views: 486 | PDF Downloads: 299

##plugins.themes.bootstrap3.article.details##

Keywords

fiscal policy, budget system, budget architectonics, budget deficit, government debt

References

Harumová, A. (2002). Dane v teórii a praxi. Bratislava: Iura Edition, 240 р.

Karlin, M. (2014). Sotsialna i fiskalna polityka derzhavy: problemy rehionalnoi koordynatsii v umovakh novoho etapu hlobalizatsii [Social and fiscal policy of the state: problems of regional coordination in the conditions of a new stage of globalization]. Demography and Social Economics, 2(22), 34–44. Retrieved from: http://nbuv.gov.ua/UJRN/dse_2014_2_5

Montes, G., & Luna, P. (2018). Discretionary fiscal policy and disagreement in expectations about fiscal variables empirical evidence from Brazil. Economic Modelling.

Cavallari, L., & Romano, S. (2017). Fiscal policy in Europe: The importance of making it predictable. Economic Modelling, 60, 81–97.

Combes, Jean-Louis, Minea, A., & Sow, M. (2017). Is fiscal policy always counter- (pro-) cyclical? The role of public debt and fiscal rules. Economic Modelling, 65, 138–146.

Bashar, Omr H.M.N., Bhattacharya, P., & Wohar, M. (2017). The cyclicality of fiscal policy: New evidence from unobserved components approach. Journal of Macroeconomics, 53, 222–234.

Kameda, К. (2014). Budget deficits, government debt, and long-term interest rates in Japan. Journal of the Japanese and International Economies, 32, 105–124.

Taylor, L., Proaño, C., Carvalho, L., & Nelson, В. (2012). Fiscal deficits, economic growth and government debt in the USA. Cambridge Journal of Economics, 36, 189–204.

Arjomand, М., Emami, K., Salimi, F. (2016). Growth and Productivity; The Role of Budget Deficit in the MENA Selected Countries. Procedia Economics and Finance, 36, 345–352.

Biolsi, C. (2017). Nonlinear effects of fiscal policy over the business cycle. Journal of Economic Dynamics and Control, 78, 54–87.

Mencingera, J., Aristovnika, A., & Verbičab, M. (2017). Asymmetric effects of fiscal policy in EU and OECD countries. Economic Modelling, 61, 448–461.

Dupaigne, М., & Fève, Р. (2016). Persistent government spending and fiscal multipliers: The investment-channel. European Economic Review, 89, 425–453.

Hory, Marie-Pierre (2016). Fiscal multipliers in Emerging Market Economies: Can we learn something from Advanced Economies? International Economics, 146, 59–84.

Allard, J., Catenaro, М., Vidal, Jean-Pierre, & Wolswijk, G. (2013). Central bank communication on fiscal policy. European Journal of Political Economy, 30, 1–14.

Wang, L. (2018). Monetary-fiscal policy interactions under asset purchase programs: Some comparative evidence. Economic Modelling.

Çebi, С. (2012). The interaction between monetary and fiscal policies in Turkey: An estimated New Keynesian DSGE model. Economic Modelling, 29, 1258–1267 р.

Auernheimer, L. (2008). Monetary Policy Rules, the Fiscal Theory of the Price Level, and (Almost) All that Jazz: In Quest of Simplicity.