CONSIDERATION REGARDING BUDGETARY POLICY IN ROMANIA

Abstract

This paper aims to study the dynamics of the government expenditures, revenues and budgetary balance and to determine the type of budgetary policy adopted in Romania, in the period 1999-2015. The research starts with a theoretical review of the budgetary policy which includes the actions of the governmental authorities, regarding revenue collection and budget expenditures, channels and means of attracting resources. This policy is considered to be a tool in influencing the economy to attenuate the cyclical fluctuation in economy, by accepting the budgetary deficit as a viable solution for the revival and simulation of economic growth. The real value of budget balance represents the actual balance recorded during a certain period and the cyclic balance indicates the difference between the actual balance and the structural balance. This research is focused on the study of budgetary policy implemented in Romania by making a quantitative analysis of the following macroeconomic indicators: governmental expenditures and revenues, budgetary deficit and real GDP. Moreover, a correlation between the dynamics of the structural budgetary deficit and the sign of the output gap has been done, and the results have indicated that, in the analyzed period, a restrictive budgetary policy was adopted in 2000-2004 and in 2011-2014, and an expansionist budgetary policy was implemented from 2005 to 2010. The results of this research highlight the main particularities of the budgetary balance in Romania and the actions taken through this channel in different phase of the business cycle.

Keywords

• GDP, government revenue, government expenditure, budgetary deficit, budgetary policy