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Fiscal Impacts on Output in a Small Open Economy: The Case of Albania

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  • Patonov Nikolay

    (South-West University “Neofit Rilski” Blagoevgrad, Bulgaria)

Abstract

The paper is intended to study the effects of total government spending and tax revenue on the annual GDP growth rate in Albania. On this base, we can examine whether and to which extent the macroeconomic governance could rely on those fiscal instruments in terms of a small open economy. The empirical methodology is based on regression analysis which includes OLS estimation on simply specified regression model and Vector Autoregressive estimates. The results support the assumptions that government expenditure is a weak instrument for policy impacts and the government must rely on taxation to stimulate economic growth.

Suggested Citation

  • Patonov Nikolay, 2016. "Fiscal Impacts on Output in a Small Open Economy: The Case of Albania," Scientific Annals of Economics and Business, Sciendo, vol. 63(2), pages 161-169, June.
    • Handle: RePEc:vrs:aicuec:v:63:y:2016:i:2:p:161-169:n:2
    DOI: 10.1515/saeb-2016-0113
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    References listed on IDEAS

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    Cited by:

    1. Ani Stoykova & Mariya Paskaleva, 2018. "Correlation Dynamics between Southeast European Capital Markets," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 4, pages 49-82.

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