DETERMINANTS OF PUBLIC INDEBTEDNESS IN EUROPEAN UNION COUNTRIES
Journal Title: e-Finanse - Year 2018, Vol 14, Issue 3
Abstract
The paper strives to determine the impact of fiscal variables on factors determining the dynamics of public debt in European Union countries. Based on the literature, the dynamics of public debt are determined by changes of three elements: the primary balance, interest-rate-growth-differential and the change of government assets. Therefore, it seems reasonable to estimate the dynamics of these three values to find the variables crucial for limiting the growth of public debt. Three groups of dynamic panel regressions were estimated based on the one-step Generalized Method of Moments. The data was collected for the 1995-2015 period for 27 EU countries. Dependent variables included: primary balance, interest-rate-growth-differential and change of government assets. Independent variables consisted of: interest payable to GDP ratio, unemployment rate, squared unemployment rate, FDI stock to GDP, net FDI inflow to GDP, general government expenditures to GDP, share of social security expenditures and openness of the economy measured by the ratio of export and import to GDP. On the basis of statistical data, three components of debt changes were distinguished, and estimations of the dynamic panel regressions were applied to find the impact of independent variables. According to the basic models, the primary balance is lower for: countries with higher unemployment, greater FDI stock and higher general government expenditures.
Authors and Affiliations
Janusz Kudła
Keywords
Related Articles
- EP ID EP493790
- DOI 10.2478/fiqf-2018-0021
- Views 70
- Downloads 0
ANALYSIS OF THE PRIVATIZATION PROCESS IN POLAND IN THE YEARS 2008-2011 – OUTCOMES AND PROSPECTS
The paper focuses on the analysis of the privatization process conducted in the years 2008-2011 with an attempt to show a broad picture of privatization in Poland, indicate resources that still exist although hidden and...
SIGNIFICANCE OF THE ACCOUNTING PARADIGM IN THE DECISION-MAKING PROCESS IN COMPANY MANAGEMENT (BASED ONIAS ACCOUNTING PRACTICES IN POLAND AND OTHER COUNTRIES)
In this article, we analyze the relations between modern trends in accounting and the decisionmaking process based on the classic profit-opportunity-cost-risk construction. In this aspect, four main types of accounting p...
THE EFFECT OF AN ELECTRONIC EXCHANGE ON PRICES AND RETURN VOLATILITY IN THE FINE WINE MARKET
Fine wine has become an attractive alternative asset class in recent decades. In our study, we take the market microstructural perspective and verify how innovations in trading infrastructure affect the fine wine market....
THE IMPACT OF QUANTITATIVE EASING ON EMERGING MARKETS – LITERATURE REVIEW
The article presents the results of the review of the empirical literature regarding the impact of quantitative easing (QE) on emerging markets (EMs). The subject is of interest to policymakers and researchers due to the...
High propensity to pay dividends by state-controlled companies in Poland. Tunneling or maturity effect?
Usage of a random effects panel logit model have shown in this paper that the high propensity to pay dividends by the state-controlled companies quoted on the Warsaw Stock Exchange over the last years was not a result of...