Fiscal policy as a measure of improving the economy: Government expenditures, taxation and public debt
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Date
2024-01-31Author
Yiasemi, ElenaPublisher
Πανεπιστήμιο Κύπρου, Σχολή Οικονομικών Επιστημών και Διοίκησης / University of Cyprus, Faculty of Economics and ManagementPlace of publication
CyprusGoogle Scholar check
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The study aims to explore the impact of fiscal policies on the growth rate of GDP and the ratio of public debt to GDP. Specifically, it analyses how changes in public spending and expenses affect the economy. The study examines data from EU member states between 2000 and 2022. It suggests that tax cuts are more likely to stimulate growth compared to increases in spending. Furthermore, during periods of fiscal adjustment, government spending cuts and stable taxes are found to be more effective in reducing deficits and debt to GDP than tax increases. Additionally, the study highlights the positive impact of public investment, which helps limit public debt and promote economic development. The role of the EU in the development of member countries
is also taken into consideration. The study assesses whether the policies proposed by EU institutions contribute to achieving economic growth and reducing public debt, which are the ultimate goals.
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