Institutional Asymmetries in Budget Expenditures and Prospects of their Overcoming in Ukraine
Journal Title: Проблеми економіки - Year 2015, Vol 2015, Issue 4
Abstract
The problems of overcoming the institutional deformations in the policy of forming budget expenditures have been studies. It has been proved that the problems arising in the area of budget expenditures have not only economic, but institutional character as well. The development of the institutional environment is related to the formation and development of the financial infrastructure, which management component directly affects the state economic development. Imbalances in the development of the institutional environment and financial infrastructure have a negative impact on forming the policy of budget expenditures and the rate of the state economic development. This leads to the need for timely identifying and overcoming the institutional asymmetries in the policy of budget expenditures. Based on the results of the conducted research it has been revealed that the institutional asymmetries in budget expenditures are caused by three main reasons. The first one affects the overall dynamics of budget expenditures and is using the "manual" control over distribution of expenditures. The second is in increasing the volume of financing social areas (up to 2013) against the low GDP growth rates and recession in the sector of non-financial corporations, that is, under conditions of lack of their own basis for ensuring financial security of these processes. The third one is in increasing the budget expenditures on general state functions at low institutional capacity of public administration, so that the budget funds are allocated and used efficiently, with minimal benefit for society. It has been proved that overcoming the existing institutional deformation and preventing the emergence of new ones is possible at the implementation of one of the following options of the state policy. The first one implies reducing the expenditures on general state functions to the level of economically developed countries. This should be carried out parallel to the measures on enhancing the institutional capacity of public administration by reducing the number of the management staff and raising responsibility for an inefficient use of the budget funds. The second one suggests maintaining a high level of budget expenditures, including those on general state functions and focusing on improving the institutional capacity of public administration. Under this option, the priorities of the society development will be a high proportion of public sector and relatively high level of taxation. The third one involves a gradual reduction in the budget expenditures on general state functions, improving the institutional capacity of the public administration apparatus, control over growth rates of budget expenditures on other items within the GDP growth rate. This option is the most mild but a positive effect from its implementation will be delayed for several years after economic stabilization.
Authors and Affiliations
Tetiana Paientko
Keywords
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