Deficits and Growth from Romania's Perspective

Abstract

In the last eight years Romania has encountereda significant growth of the GDP. However,the economy does not seem capable to value thisgrowth by balancing the budget and reducing thecurrent account deficit, problems that are persistentduring the last period.In 2008 the Romanian economy had thehighest level of budget deficit since the 90’s. Thereis an important debate between the economistson this issue and we have to see if there is anyreason to worry, having in mind the current globalfinancial crisis.This paper tries to analyze the problemsof budgetary deficit, current account deficit andeconomic growth. We will take a look on last periodstatistics and on specific literature, see how thosevariables evolved over time and in different casesand we will try to identify possible connectionsbetween them.