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Optimal Fiscal Policy – Factors for the Formation of the Optimal Economic and Social Models


  • George Abuselidze

    () (Faculty of Economics and Business, Batumi Shota Rustaveli State University)


Objective – The purpose of this paper is to develop the optimal economic and social model for the modern stage and analyze the Social Progress Index in Georgia. The research is based on the paradigm that "what we analyze, this determines the decisions we make". Consequently, emphasis is placed on issues that significantly affect human wellbeing. Methodology/Technique – In this top-down study, the empirical material is collected from official documents and public statements made by centrally placed politicians and administrators in Georgia as well as research conducted by international organizations in Georgia. The research database used is the legislative and normative acts adopted by the government of Georgia in the modern day, in particular: the National Statistics Office of Georgia, the Economic Development and Finance Ministries, the Georgian National Statistics Office, the Parliamentary Finance and Budget Committee and other related departments. Findings – This study shows that the formation of the optimal economic and social organization model of a country is particularly dependent on the selection and implementation of the most appropriate fiscal policy. The philosophy of social security is one of the greatest achievements of modern civilization. The present work is dedicated to the progress of human development – specifically, welfare issues. This provides the model for creating the optimal social security system of a population, with the following social system parameters: distribution of national income to the population and their families and addressing the issues of financing social security needs. Based on the study of the social experiences of social reform and the social indicators of the European Union, the alternate concept of prosperity and perfection is developed. These topics are the focus of the present work. Novelty – The empirical material contained within focuses on the period after 2005, when some important changes in political leadership took place. In 2003, Saakashvili became President of Georgia, Ivanishvili was elected as Prime Minister in 2012 and Kvirikashvili took over this position in 2015. During this time, there was also a shift in government social policy at a central level. The collection of empirical data for this study ends in 2017, giving a total study period of 12 years.

Suggested Citation

  • George Abuselidze, 2018. "Optimal Fiscal Policy – Factors for the Formation of the Optimal Economic and Social Models," GATR Journals jber153, Global Academy of Training and Research (GATR) Enterprise.
  • Handle: RePEc:gtr:gatrjs:jber153

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    References listed on IDEAS

    1. George Abuselidze, 2012. "Optimal Tax Burden and Budget System – the Factor of Macroeconomical Stabilization," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 2(6), pages 1-9.
    2. Sandmo, Agnar, 1990. "Tax Distortions and Household Production," Oxford Economic Papers, Oxford University Press, vol. 42(1), pages 78-90, January.
    3. Abuselidze, George, 2012. "Optimal Tax Burden and Budget System – the Factor of Macroeconomical Stabilization," MPRA Paper 49281, University Library of Munich, Germany, revised 14 Sep 2012.
    4. Abuselidze, George, 2015. "Formation of Tax Policy in the Aspect of the Optimal Tax Burden," MPRA Paper 86277, University Library of Munich, Germany, revised 02 Jun 2015.
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    More about this item


    Fiscal Policy; Welfare; Social Security; Social Innovation; Household; Employment.;

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
    • H61 - Public Economics - - National Budget, Deficit, and Debt - - - Budget; Budget Systems
    • R2 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis
    • R51 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Finance in Urban and Rural Economies

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