Fiscal and Financial Stability in Romania - An Overview

Transylvanian Review of Administrative Sciences. 2013;9(40):159-182

 

Journal Homepage

Journal Title: Transylvanian Review of Administrative Sciences

ISSN: 1842-2845 (Print)

Publisher: Babes Bolyai University

Society/Institution: Babes Bolyai University, Public Administration Department

LCC Subject Category: Political science: Political institutions and public administration (General)

Country of publisher: Romania

Language of fulltext: English

Full-text formats available: PDF

 

AUTHORS

Florin OPREA (Associate professor, Ph.D., Department of Finance, Money and Public Administration, Faculty of Economics and Business Administration, Alexandru Ioan Cuza University of Iaşi, Romania)
Seyed MEHDIAN (Professor, Ph.D., School of Management, University of Michigan-Flint, Flint, Michigan, USA)
Ovidiu STOICA (Professor, Ph.D., Department of Finance, Money and Public Administration, Faculty of Economics and Business Administration, Alexandru Ioan Cuza University of Iaşi, Romania)

EDITORIAL INFORMATION

Double blind peer review

Editorial Board

Instructions for authors

Time From Submission to Publication: 25 weeks

 

Abstract | Full Text

<p>The recent financial crisis has seriously shaken economies around the world, and raised serious doubts about the long-term viability of the public policies to remedy market imperfections. The effect has been pronounced for Romania, a newly transitioned country with a fragile market economy due to political, economic and social consequents. This paper examines the correlation between fiscal policy and financial stability in Romania in the period from 1990 to 2011. Specifically, we analyze the country’s main monetary and fiscal policy decisions and their associations with macro-economic variables, highlighting the requirements for a sustainable macro-economic policy and whether such requirements have been met in Romania. Based on the results, we further outline recommendations to improve Romania’s public policy initiatives, considering the specific correlations between monetary and fiscal policies. The results for the period under study indicate that fiscal and monetary policies promoted in Romania have not been consistently harmonized, at times lacking necessary mutual support, or even generating conflicting outcomes favorable to the manifestation of fiscal and financial instability.</p>