Public investment and fiscal performance in the new EU member states

0358754 - NHU-C 2012 RIV US eng J - Journal Article
Hanousek, Jan - Kočenda, Evžen
Public investment and fiscal performance in the new EU member states.
Fiscal Studies. Roč. 32, č. 1 (2011), s. 43-71. ISSN 0143-5671. E-ISSN 1475-5890
R&D Projects: GA ČR GA402/09/1595; GA MŠMT LC542
Institutional research plan: CEZ:MSM0021620846
Keywords : public finance * public investment * economic freedom
Subject RIV: AH - Economics
Impact factor: 0.486, year: 2011

In this paper, we analyse the dynamics of public investment and public finance in the new members of the European Union, and also how they were affected by changes in economic freedom and corruption. We find that improvements in economic freedom tend to be associated with increases in public investment, while reductions in corruption produce effects going in both directions. Similarly, we show that increases in public investment are often linked with decreases as well as increases in corruption. In terms of the public finances, we detect mostly improvements in debt when there is less economic regulation, while results for the deficit are less conclusive. On the other hand, improvements in the corruption environment are mostly associated with decreases in the deficit as well as debt.
Permanent Link: http://hdl.handle.net/11104/0196700