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Fiscal policy and net capital inflows in developing countries are procyclical. A large amount of literature has examined this phenomenon and explored its consequences for aggregate fluctuations. Multilateral development banks (MDBs) are an important source of external finance for governments and play a key role in financing the execution of fiscal policy. Hence, understanding the behavior of MDB flows is key to gauge their contribution to macroeconomic volatility. This paper investigates the co-movement of sovereign lending from MDBs and private creditors with government expenditure, and finds that multilateral sovereign lending follows government expenditure, and that this correlation does not change if the government is running a surplus or a deficit. This finding raises doubts on the feasibility of MDBs to be counter-cyclical, unless the governments themselves implement counter-cyclical fiscal policies.

The relationship between government expenditure and its revenue is generating serious debate among researchers. Similarly, their has been a controversy between the classical and the bayesian modelling. Therfore, this study examined the relationship between the government expenditure and its revenue in Nigeria using the bayesian approach. The finance data extracted from the Central Bank of Nigeria statistical bulletin from 1989 to 2018 were considered for the study. Bayesian linear regression was used to fit the model. Normal distribution was fit for the likelihood. Thus, normal-gamma prior was elicited for the bayesian regression parameters. The result showed that the Bayesian estimates with elicited normal-gamma prior produced a better posterior mean of 0.536 for the Total Revenue with a smaller posterior standard deviation of 0.00001 when compared with the OLS standard deviation of 0.05256. Similarly, the total revenue explained 78% variations in the Total expenditure. The constructed model fit was: Total Expenditure = 98.57128 + 0.53630* Total Revenue. This showed that a naira unit of the total expenditure will always be increased by 0.54 of the total revenue. Forecast of 30 years for the total expenditure using both OLS and Bayesian (normal gamma prior) were increasing as the years were progressing. Government should look for a way to increase its revenue in order to sustain the future expenses of the government since expenditure increases yearly.

We examine the impact of public debt changes as well as the effects of the business cycle on the expenditure multipliers. We adopt the structural vector autoregressive (SVAR) methodology on quarter...

Governments will want to achieve their highest priority goal according to their economic circumstances. Governments use many tools to achieve these goals. Economic growth and price stability are among the main objectives which fall within the scope of governments. One of the most important tools that governments will deploy to achieve these goals government expenditures, which is a fiscal policy tool. In this study, the relationship between government expenditures, economic growth and inflation in 9 randomly selected OECD countries (France, Germany, Italy, UK, Portugal, Hungary, Spain, Finland and Poland) was analyzed by panel causality method using annual data for the period 2010-2019. As a result of the analysis, a bidirectional causality relationship was found between economic growth and inflation in the period analyzed. It was also found that there was a unidirectional causality relationship from inflation to government expenditures and from government expenditures to economic growth.

This paper examined the impact of fiscal policy on non-oil GDP in Saudi Arabia, the world’s largest oil exporter, over the annual period 1989–2018. We employed various cointegration methods within ...

Many studies in recent years have focused on the relationship between the government's ability to manage and economic performance indicators. There is ample empirical evidence that factors such as the presence of corruption, violence, and terrorism in a country, and the quality of institutions controlling the market affect the success of economic policies. Similarly, the issue of how the public debt stock affects economic growth has been the central question of many studies. Especially in recent years, the violence, terrorism, and separatist wars that have emerged in Africa have led to the intensification of studies on the continent. In addition, there are many studies supporting that the climate of insecurity created by the violence and terrorist incidents in the continent is the cause of the failure of governance in Africa. Governance failure is also an indicator of ineffectiveness in the formulation and implementation of public policies. This study focuses on investigating the effects of fiscal performance and governance quality on economic growth in Sub-Saharan African countries. In the study, data from 25 sub-Saharan African countries for the period 2002-2019 were used. According to the results of the analysis, as public expenditures increase in the mentioned countries, economic growth decreases. In terms of the focus of the study, it has been found that as fiscal performance and governance quality increase, economic growth also increases. As a fiscal performance indicator, the arithmetic average of the public's domestic and external debt stock was calculated and included in the analysis. An increase in the fiscal performance value means an increase in the country's debt stock.

This paper addresses the impact of productive government expenditure on income inequality using a dataset of 80 countries over the period of 1980–2015. It incorporates the conflicting predictions implied by alternative growth models on this issue. While the neoclassical model suggests that productive government expenditure will reduce long-run income inequality, the corresponding endogenous growth model suggests the opposite. We examine this proposition, by considering both the aggregate Gini coefficient, and the income shares of quintiles. The results obtained using the Gini coefficients provide compelling support for the contrasting impacts of government investment on income inequality, suggested by the underlying theoretical models. These findings are supported, albeit somewhat more weakly by the regressions employing the quintile data. Our general conclusion is that government investment has a mixed effect on income inequality, a conclusion consistent with previous studies.

This study examines the relationship between renewable energy consumption, poverty alleviation and economic growth in South Africa. The paper applies the Autoregressive distributed lag (ARDL) model to examine the long run relationship and the Vector Error Correction Model (VECM) to determine the direction of causality between the variables. Quarterly data is used for the period 1990 – 2018. The findings of the paper established a presence of a long run relationship between renewable energy consumption, poverty, economic growth, financial development and government expenditure. Specifically, renewable energy consumption and economic growth have a negative and significant impact on poverty in both long run and short run. The VECM suggest that renewable energy consumption Granger-causes both economic growth and poverty in the long. Moreover, there is a bidirectional causality flowing between poverty and economic growth. The results have important implication for renewable energy policy makers as it can be realised that policies that promote adoption of clean technology will alleviate poverty in South Africa.Keywords: Renewable energy consumption, poverty alleviation, economic growth, South AfricaJEL Classifications: C32, D04, Q47, Q42, Q01DOI: https://doi.org/10.32479/ijeep.7215

This study investigates the impact of Nigerian government expenditure (disaggregated into capital and recurrent) on economic growth using time series data for the period 1970-2019. The paper employs Autoregressive Distributed Lag (ARDL) model. To ensure robustness of results, the study accounts for structural breaks in the unit root test and the co-integration analysis. The key findings of the study are that capital expenditure has positive and significant impact on economic growth both in the short run and long run while recurrent expenditure does not have significant impact on economic growth both in the short run and long run. The study recommends that government should increase the share of the capital expenditure especially on meaningful projects that have direct bearing on the citizen’s welfare. Government should also improve the spending patterns of recurrent expenditure through careful reallocation of resources toward productive activities that would enhance human development in the country.

Research represented in this article is aimed to evaluate potential multiplier effect of expenditure on digitalization of Russian economy stated by the special National Program “Digital economy Russian Federation” for 2018 – 2024 as the planned indicators. In order to calculate multiplier effect authors have used potential autonomous expenditure multiplier coefficient which is directly related to the average propensity to consume domestically produced goods and services. Authors, using data of Russian statistics and own calculation, have measured the average size of multiplier coefficient in Russian economy over 2014 – 2019 and the size of potential multiplier effect that can be generated by National Program of digitalization. The position is substantiated that the development of own digital technologies can enhance the multiplier effect, contributing to economic growth.

This study employs the vector autoregressive model (VAR), impulse response function and variance decomposition to study the impact of oil price shocks on components of government spending on both oil-exporting and oil importing countries over the period from 1980 to 2018. While the vast majority of previous studies focused on the impact of oil price shocks on government spending, this study emphasized the impact of these shocks on the current and capital government expenditure. It was found that oil price shocks affect government current expenditure positively in the two groups of countries. While it affects government capital expenditure positively in oil-exporting countries and negatively in oil-importing countries.Keywords: Oil-exporting countries, Oil-importing countries, Oil price, VAR model, government expenditures.JEL Classifications: H5, O13, Q43DOI: https://doi.org/10.32479/ijeep.11172

The purpose of this study was to determine the effect of unemployment, economic growth, education and health sector government spending on the Human Development Index in Aceh. The data used in this study is secondary data from the Central Bureau of Statistics (BPS), the data used is the 20082019 period. The method of analysis used in this study is multiple linear regression analysis using statistical tests to determine the 95% degree of confidence. (𝛼 = 0.05) on the t test. The results of this study indicate that partially the unemployment variable has a positive and insignificant effect, the Economic Growth variable has a positive and significant effect, the Education Sector Government Expenditure variable has a positive and insignificant effect and the Education Sector Government Expenditure has a negative and significant effect on the Human Development Index in Aceh. Then simultaneously it has a positive and insignificant effect on the Human Development Index in Aceh.

The study used time series data from 1980 to 2018 and the Nonlinear ARDL approach to analyse the asymmetric impacts of fiscal policy on economic growth in Nigeria. The bounds test findings indicate...

This study examined the effect of government expenditure on the growth of the industrial sector in Nigeria. A regression analysis was applied in the analysis of the data. The study found that government capital expenditure has positive and significant effect on the industrial sector; tax has positive and significant effect on the industrial sector; monetary policy rate has positive and significant effect on the growth of the industrial sector, while real interest rate has a negative and no significant effect on the growth of the industrial sector. From the findings, we conclude that government policy has significant effect on the growth of the Nigerian industrial sector. It recommends that government fiscal policies such as public expending should be directed toward improving the quality of infrastructures in the country, especially the power sector, so that the cost of production can reduce. Government should examine should create an enabling environment with the right infrastructure, improve the security situation and reduce the epileptic power supply related issues. Also, government should examine its monetary policy variables such as interest rate and monetary policy rate. Furthermore, to promote growth, government should develop the industrial sectors of the economy through its capital expenditure.

We study the interactions between institutional quality, government expenditure, tax revenue, and economic growth in low-income countries (LICs) and lower middle-income countries (LMICs) over 2005–2019. The primary distinguishing factor of the paper is the simultaneous inclusion of all these four variables in a single temporal causal model. A second distinguishing feature of the paper is its focus on LICs and LMICs and a clear distinction between short-run and long-run results. Tax revenue is considered as general revenue as well as revenue from taxes on international trade, and customs and other import duties. Our results show that institutional quality, government expenditure, tax revenue, and economic growth often have endogenous links among each other in the short run. These results are not always uniform across our samples. On the other hand, a robust and uniform result across all samples is that the three covariates are important drivers of long-term economic growth. Thus, the co-development of stronger institutions and more effective fiscal policies (relating to taxes and government expenditure) appear to be key in procuring sustained long-term economic growth of countries.

The controversial debate on whether high population translates to weak or better economic growth has been a topical discussion in the area of development economics. This study therefore uses the data of the Nigerian economy to investigate the links among population growth, growth in output and income per capita growth for the periods of 1981–2018. The study employs both ARDL bound testing approach to cointegration and fully modified least square methods to evaluate the parameter estimates. We found that there exists a long-run relationship between population growth and economic growth in Nigeria. Further, the study found that the statistical and significant effect of population growth is more on long-run income growth than long-run income per capita growth. Meanwhile, in the short-run, an adverse effect is reported from population growth to economic growth, implying that the former has a detrimental effect on the latter. The reason for the adverse effects of population growth in the short-run results from the high number of dependents, whereas, in the long-run, there is a chance of demographic dividend that makes the young people becomes productive in their adulthood. Our findings, therefore, support the league of many studies that population growth is an asset to the long-run economic growth of Nigeria. In contrast, it has a poor impact on economic performance in the short-run. Thus, there is a need for proper and adequate utilization of the country’s rising population in appropriate areas of the economy where their efforts would be fully utilized towards improving the overall growth of Nigeria.

This study verifies the validation of Wagner’s theory and Keynes's hypothesis between three main government expenditure components (Health expenditure, education expenditure, and capital investment expenditure) and economic growth in Nigeria and Angola. The study employs Johansen cointegration and pairwise granger causality as the estimation techniques. Findings revealed no evidence of long-run relationships with government expenditure components of health, education, and capital investment and economic growth. The study equally reveals the validation of Wagner’s theory between growth and expenditure on health in both Nigeria and Angola. Evidence that confirms both Wagner’s theory and Keynes's hypothesis between growth and expenditure on education in Angola and validation of only Keynes hypothesis in Nigeria was found. Also, the study confirms the validation of Keynes's hypothesis between government expenditure on capital investment in both Nigeria and Angola

Penelitian ini dilatarbelakangi oleh adanya peningkatan pertumbuhan ekonomi merupakan tujuan bagi suatu Negara, yang didukung dengan pembangunan ekonomi. Namun pertumbuhan ekonomi di Indonesia selama tahun 2010-2019 belum menunjukkan hasil yang terus meningkat pada level nasional disamping itu kemiskinan dan ketimpangan yang belum dapat menurun. Kondisi tersebut bertolakbelakang dengan tujuan tercapainya pertumbuhan ekonomi inklusif. Penelitian ini bertujuan untuk mengukur dan menganalisis Pertumbuhan Ekonomi Inklusif dan faktor-faktor yang mempengaruhinya. Terdapat dua metode analisis yang digunakan dalam penelitian ini, yaitu analisis model Poverty-Equivalent Growth Rate (PEGR) dan analisis regresi linier berganda dengan data time series. Hasil penelitian menunjukan bahwa pada satu dekade terakhir pertumbuhan ekonomi inklusif di Indonesia belum konsisten tercapai setiap tahun. Hasil analisis regresi data time series menunjukkan bahwa variabel pengeluaran pemerintah bidang pendidikan dan pengeluaran pemerintah bidang kesehatan berpengaruh signifikan terhadap pertumbuhan ekonomi inklusif. Variabel pengeluaran pemerintah bidang pendidikan memiliki pengaruh yang berbanding terbalik terhadap pertumbuhan ekonomi inklusif, Sedangkan variabel tingkat pengangguran terbuka (TPT) berpengaruh tidak signifikan tehadap pertumbuhan ekonomi inklusif. Adapun upaya yang dapat dilakukan melalui impikasi kebijakan pemerintah yaitu penguatan Program Indonesia Pintar (PIP), hingga pendidikan vokasi, penguatan program kesehatan melalui penambahan fasilitas kesehatan, perekrutan tenaga medis, hingga memaksimalkan kartu Indonesia sehat dan BPJS.

The advancement of technological innovations may facilitate the coordinated development of the economy and ecological environment (EGE); however, few studies have noted the role of innovation efficiency (INEF) as a bridge between economic development and EGE. To fill in this gap, this paper adopts DMSP/OLS nighttime light data to measure the level of economic development and the improved data envelopment analysis model to measure INEF, establishing an index system to quantify EGE. Then we propose the panel threshold-mediating (PTM) model that combines the panel threshold model and the mediating effect model. On these bases, considering INEF as a mediator, we use this novel PTM model to empirically test the nonlinear relationship between economic development and EGE in 283 Chinese cities from 2003 to 2018. The results indicate that (1) while economic development can improve EGE, its positive impact on EGE differs with different INEF thresholds. A higher INEF threshold indicates a stronger positive effect of economic development on EGE. (2) For the entire sample, the mediating effect of INEF between economic development and EGE is not significant. However, after applying the PTM model, we found that the mediating effect of INEF was concealed by the sample population. (3) When INEF is lower than 0.2381, its complete mediating effect is verified. When INEF is higher than 0.2381, its mediating effect is not significant. On the contrary, economic development directly improves EGE. (4) Industrial agglomeration, the scale of government expenditure, residents' education level, degree of opening up, and transport infrastructure are all conducive to EGE. These findings can help cities at different INEF levels to achieve coordinated development of economy and EGE.

This research aims to analyze the effect of government spending on education and health, economic growth, poverty levels, and Labor Force Participation Rate (LFPR) on the gender development index of regency/cities in East Java in 2017-2019. This research uses a quantitative approach and panel data regression using a fixed effect model, as the technical data analysis. The results showed that the government expenditure variables for education and health had a positive and insignificant effect on the gender development index in East Java. The economic growth variable has a negative and significant effect on the gender development index in East Java. The poverty rate variable has a negative and significant effect on the gender development index of regency/cities in East Java. While, the variable of Labor Force Participation Rate (LFPR) has positive and insignificant influence towards gender development index of regency/city in East Java.

The purpose of this research to examine influence several independent variables, especially corruption, foreign direct investment (FDI), population growth, and government expenditure on the economic growth of 10 Asia-Pacific countries, and prove the hypothesis of the sand wheels theory whether corruption causes a decline and a slowdown in economic growth. This study uses panel data. The results showed that the variables of corruption have a negative impact on economic growth, foreign direct investment (FDI), and government expenditure have positives that significantly affect the level of economic growth in 10 Asia-Pacific countries. However, population growth does not significantly affect economic growth. The result implies that corruption has a negative effect on economic growth in 10 Asia-Pacific countries. Such an outcome provides evidence and confirms the hypothesis that corruption can sand the wheel of an economy. Countries must eradicate all forms of corruption and maintain a conducive investment climate so that there is a level of trust, especially in the Asia-Pacific countries, to create productive economic growth.JEL Classification: O47, D73, C12How to Cite:Nasir, M. S., Wibowo, A. R., & Yansyah, D. (2021). The Determinants of Economic Growth: Empirical Study Of 10 Asia-Pacific Countries. Signifikan: Jurnal Ilmu Ekonomi, 10(1), 149-160. https://doi.org/10.18752/sjie.v10i1.15310.

In this paper, we tested the Wagner’s Law against the Keynesian Hypothesis for Indonesia using granger causality test. After conducting theoretical and empirical theory, this paper is analysing the relationship between government expenditure and GDP percapita. The long run parameters and causality test found valid Wagners’ Law in Indonesia not Keynesian Hypothesis. The results reveal a positive and statistically significant long run effect running from economic growth toward the government expenditure refer to Wagner’s Law in Indonesia. Further more, the growth of population is giving a positive effect for government expenditure also.

The study investigated the impact of government expenditure on economic growth with special inclination to testing the Wagner’s law in Sub Saharan Africa between 1986 and 2018. Adopting the Panel first generation tests as well as the Panel Auto Regressive Distributed Lag (ARDL) and Pairwise Causality techniques, it was revealed that government expenditure causes economic growth rendering the Wagner’s law is invalid in the Sub-Saharan region. Also, it was further discovered that capital and recurrent expenditure exert negative effect on economic growth while total expenditure has positive effect on economic growth in the region. Therefore, based on the negativity of capital and recurrent expenditure, it is recommended that capital and recurrent expenditure must be monitored effectively to ensure that its increase will not exert any negative effect on economic growth while stringent measures as well as checks and balances must be adopted to curb corruption in Sub-Saharan Africa to ensure that funds are used exclusively for their intended purposes especially those pertaining to capital projects.

The article considers the influence of the complexity of the social system on the growth of financial costs for the maintenance of the central management system. The subject of the article is Professor Dmitry Sorokin’s theory that Russia cannot be a world technological leader due to objective reasons: a large territory, a severe climate, a multinational and multi-confessional composition of the population. These conditions predetermine a strong power vertical and increased financial costs, leading to the bureaucratic despotism and worse effectiveness of market innovation mechanisms. The relevance of the problem is in the need to clarify the management capabilities and limitations of regimes with strong centralized power. This issue is becoming more urgent due to the fact Wagner’s law, which requires faster growth of public expenditure compared to the economy, has ceased to operate. The article aims to theoretically illustrate and to test the theory by D. Sorokin. On this purpose, the authors built a simple theoretical model of economic growth with an institutional factor reflecting the properties of the control system. The novelty of the approach consists in building an institutional function that includes management costs for maintaining the internal integrity of the country and its external security, the management potential (“strength”) of the central government and the mechanism of market selfgovernment. The initial driving force of the model is the growing complexity of the managed system, which, by D. Zolo’s complexity theory, leads to the wide spread of authoritarian political regimes. The analysis of the model and computational experiments allowed to establish the conditions when Sorokin’s theory is valid and when not. The calculations have led to the conclusion that even a tough authoritarian rule can stimulate the country’s economic development, provided that the current system of central government is highly efficient and low in financial capacity.

Unpredictability of development aid has been a key concern for the international community, which has committed, in the Paris declaration on Aid effectiveness, to making development aid more predictable for recipient-countries. At the same time, the international trade community has committed to help developing countries, and in particular Least developed countries (LDCs) better integrate into the multilateral trading system through the provision of higher amounts of Aid for Trade (AfT). The current article investigates the effect of AfT unpredictability on trade-related government expenditure in recipient-countries. The analysis covers an unbalanced panel dataset of 58 countries over the period 2009-2016. Empirical results are primarily obtained using the two-step system Generalized Methods of Moments (GMM) estimator. The findings indicate that over the full sample, unpredictability of total AfT, as well as both positive and negative unpredictability of total AfT exert a negative and significant effect on total trade-related government expenditure. Results show mixed evidence concerning the effect of unpredictability of AfT components on relevant trade-related government expenditure, including in LDCs and NonLDCs (countries that are not LDCs). Finally, there may be a non-linear relationship between AfT unpredictability and trade-related government expenditure. Overall, these findings shed light on the importance for donors and recipient-countries to coordinate efforts so as to make AfT more predictable.

This study analyses the impact of fiscal decentralisation policy on economic development and poverty reduction. It focuses on the practice of intergovernmental fiscal transfer and on special autonomy policy in Aceh province, Indonesia, using data from 23 districts gathered from 2008 to 2018. Undertaking a panel data analysis, it will analyse the impact of intergovernmental fiscal transfer from central to local government on local government expenditure. The impact of local government expenditures and fiscal decentralisation practices on local gross domestic product (GDP) and poverty is also measured. The results show that several intergovernmental fiscal transfer policies in Aceh positively enhance the local expenditure. Further, the local government spending and fiscal decentralisation practices in Aceh improve the local GDP and reduce poverty levels in the region.