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The assessment of budget expenditures impact on economic activity

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  • I. V. Belyakov

Abstract

The article explores the impact of government spending on the key components of economic activity in Russia, such as private consumption and investment. The author pays serious attention to the theoretical justifications of the possible impact of fiscal policy on economic growth and its components, as well as reviews the empirical results obtained in this area. In the empirical part of the article, government expenditures are represented by the “GDP by expenditure” items — government consumption and government investment. The results, for Russian data covering the period of 1995—2017, indicate a short-term positive impact of government spending on private consumption and a negative impact on private investment. It also proves important to take into consideration the changes in macroeconomic conditions that occurred approximately in the middle of the observed period.

Suggested Citation

  • I. V. Belyakov, 2018. "The assessment of budget expenditures impact on economic activity," Voprosy Ekonomiki, NP Voprosy Ekonomiki, issue 12.
    • Handle: RePEc:nos:voprec:y:2018:id:1831
    DOI: 10.32609/0042-8736-2018-12-28-45
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