Public Instruments in Ensuring Economic Growth. Case Study for Romania

• Author: Andronic (Bratulescu) M. L.
• Position: Transilvania University of Brasov
• Pages: 105-114

Bulletin of the Transilvania University of Braşo v

Series V: Economic Sciences • Vol. 11 (60) No. 2 – 2018

PUBLIC INSTRUMENTS IN ENSURING

ECONOMIC GROWTH.

CASE STUDY FOR ROMANIA

Maria Letiția ANDRONIC (BRĂTULESCU)1

Abstract: The main objective of the paper is to study the relationship

between some relevant macroeconomic variables in Romania for 2001-2017.

On the one hand, indicators belonging to the fiscal and budgetary policies

are emphasized, while, on the other hand, there is the economic growth .

GDP evolution is the main indicator describing the economic performance of

a country, while the governmental policies and the level of corruption play a

key role with respect to the implications they have in promoting economic

reforms. The results obtained after using several statistical tools prove that

the general consolidated budget revenues and the average monthly gross

earnings factors have a major impact on Romania’s economic development.

Key words: economic growth; public debt; budgetary policy; corruption.

1. Introduction

The fiscal and budgetary policies are some of the most significant components of the

financial policy of a country and fulfil an important role in stimulating economic growth.

Adopting the right policies at the right moment may ensure financial stability, proper

allocation of resources and, moreover, it brings about the development of the whole

economy. Both the fiscal and the budgetary policies may be defined by the financial

relationships which occur during the distribut ion process of GDP. The simple existence

of the public sector and the need for economic and social progression are basic factors

that reveal the necessity of applying the most adequate reforms at a certain time.

The fiscal policy refers to the use of fiscal instruments to influence the macroeconomic

conditions, including economic growth. Most of the coordinates on which fiscal policy is

based belong to Keynes, who claime d that the governments would be able to stabilise

the economic cycle by permanently adjusting public policies.

Complementary to the fiscal one, the budgetary policy is the policy of revenues and

expenditures. The budgetary system has to accomplish the decisions taken by the state

in order to ensure the necessary financial resources (Annicchiarico et al., 2012, p. 11).

1 Transilvania University of Braşov, letitia.andronic@unitbv.ro