The Effect of the Share of Taxes and Expenditures in National Income on Growth, a Multi-Country Analysis

Year 2024, Volume: 26 Issue: 1, 84 - 97, 29.06.2024

Bora Kurtuluş

Abstract

Economic growth stands as a crucial objective in macroeconomic policies. Within the scope of fiscal policy, government expenditures and tax revenues play significant roles. This study utilizes panel data from 103 countries spanning the period 2005 to 2019. After conducting tests for stationarity, homogeneity, and cross-sectional dependency, Panel Granger Causality tests and panel data analyses are carried out. Instead of nominal values, the shares of government expenditures and tax revenues in national income are considered. The findings reveal a reciprocal causal relationship between government expenditures and tax revenues, as indicated by the Granger Causality tests. Furthermore, economic growth is identified as a Granger cause for both tax revenues and government expenditures. While government expenditures Granger-cause growth in the short term, there is no statistically significant impact of tax revenues on economic growth. The panel regression analysis reveals a negative coefficient of government expenditures on growth, as well as a positive coefficient of taxes, both of which are statistically significant. Hence, it can be inferred that decreasing the share of government expenditures in national income positively affects economic growth while simultaneously increasing the share of tax revenues in national income. This dual effect not only contributes to economic growth but also helps achieve budget equilibrium.

Keywords

Economic Growth, Fiscal Policy, Panel Data Analysis, Time Series Analysis

Vergi ve Harcamaların Milli Gelirdeki Payının Büyümeye Etkisi, Çok Ülkeli Bir Analiz

Abstract

Ekonomik büyüme, makroekonomik politikaların temel amaçlarından biridir. Devlet harcamaları ve vergi gelirleri ise maliye politikasının iki önemli bileşenidir. Çalışmada verileri eksiksiz mevcut olan 103 ülkede 2005-2019 yılları arası panel veri kullanılmıştır. Durağanlık, homojenlik ve yatay kesit bağımlılığı için testler yapıldıktan sonra verilere uygun Panel Granger Nedensellik testleri ve panel veri analizleri uygulanmıştır. Devlet harcamaları ve vergi gelirleri değişkenlerinin aldıkları değerler değil, milli gelir içindeki payları kullanılmıştır. Çalışmada devlet harcamalarının ve vergi gelirlerinin birbirlerinin Granger nedeni olduğu bulunmuştur. Büyüme ise hem vergi gelirleri hem de devlet harcamalarına Granger nedendir. Devlet harcamaları da kısa vadede büyümeye Granger neden iken vergi gelirlerinin büyüme üzerinde bir etkisine ise rastlanmamıştır. Panel regresyon sonucunda, devlet harcamalarının büyüme üzerindeki etkisinin katsayısı negatif, vergilerin ise pozitif olduğu görülmüştür. Katsayılar istatistiksel olarak anlamlı bulunmuştur. Bunların sonucu olarak devlet harcamalarının milli gelir içindeki payının azaltılmasının büyümeye pozitif etkisinin olduğu ve bu durumun aynı zamanda vergi gelirlerinin milli gelir içindeki paylarını da arttırdığı için bütçe dengesi üzerinde de pozitif etkide bulunacağı söylenebilir.

Keywords

Ekonomik Büyüme, Maliye Politikası, Panel Veri Analizi, Zaman Serisi Analizi

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