Structural Changes and Correlations Between Income Components of Romania’s Gross Domestic Product During the Period 2000–2019

The paper reviews the theoretical framework on the modelling factors of the structure of the gross domestic product on the income side, and the significance of the respective structure for assessing the features of the economic mechanism and the development stage of a country. It is assumed that the respective structure is influenced by the phases of the economic cycles, as well. Based on the above-mentioned considerations, the authors propose a model for analysing the intensity, and directions regarding the structural changes of the gross domestic product on its income side, in the context of short economic cycles, on one hand, and the correlations between income components of gross domestic product in the long run, using econometric methods, on the other hand. The proposed methodological framework is applied in the case of Romania’s economy during the period 2000–2019. Thereby, the intensity and directions of the structural change of the gross domestic product on the income side are determined. The respective results highlight that the Keynesian assumption on the behaviour of the conventional reward, respectively the two essential production factors’ share (labour and capital) in the gross domestic product, is rejected in the case of four of the five short economic cycles identified during the considered period. Also, comparisons are made showing the persistence of important differences related to the structure of the gross domestic product on the income side between Romania and the most developed member-states of the European Union. The estimation of the equations of the proposed econometric model reveals the strong long-run correlation between the gross domestic product and the gross value added, and also the significantly more unstable dynamics of the gross operating surplus compared to the dynamics of the compensation of employees. Also, the use of dummy variables allows us to show that the 2000–2004 time interval is a particular one inside the considered timeframe 2000–2019.