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Drivers Of Gdp Growth: Evidence From Selected European Countries

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  • Milutin Ješić

Abstract

This empirical study analyses the potential determinants of GDP growth in selected European countries using data for 19 countries from Central, Eastern, and South-Eastern Europe for the period 2014 to 2020. The influence of possible drivers of economic growth are investigated by employing dynamic panel data modelling, specifically the system GMM method. The study’s findings reveal that fiscal responsibility, initial development, the inflation rate, and EU membership are the main GDP growth drivers. In addition, we control for the institutional determinants of economic growth and the role of R&D. These results provide further support for the hypothesis that macroeconomic policies conducted in a responsible and sustainable way can significantly improve countries’ growth perspectives. These findings may help us to understand that the trinity of policies, institutions, and technology is a conditio sine qua non of economic growth.

Suggested Citation

  • Milutin Ješić, 2023. "Drivers Of Gdp Growth: Evidence From Selected European Countries," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 68(238), pages 59-86, July – Se.
    • Handle: RePEc:beo:journl:v:68:y:2023:i:238:p:59-86
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    References listed on IDEAS

    as
    1. Robert J Barro, 1999. "Determinants of Economic Growth: Implications of the Global Evidence for Chile," Latin American Journal of Economics-formerly Cuadernos de Economía, Instituto de Economía. Pontificia Universidad Católica de Chile., vol. 36(107), pages 443-478.
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    More about this item

    Keywords

    GDP growth; GDP growth drivers; selected European countries; dynamic panel data; System GMM.;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C54 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Quantitative Policy Modeling
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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