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Theoretical and Applied Economics
No. 11 / 2007 (516)

An Empirical Analysis of the Budget Deficit

Ioan Talpos
Bogdan Dima
Mihai Mutascu
Cosmin Enache
West University of Timisoara

Abstract. Economic policies and, particularly, fiscal policies are not designed and implemented in an “empty space”: the structural characteristics of the economic systems, the institutional architecture of societies, the cultural paradigm and the power relations between different social groups define the borders of these policies. This paper tries to deal with these borders, to describe their nature and the implications of their existence to the fiscal policies’ quality and impact at a theoretical level as well as at an empirical one. The main results of the proposed analysis support the ideas that the mentioned variables matters both for the social mandate entrusted by the society to the state and thus to the role and functions of the state and for the economic growth as a support of the resources collected at distributed by the public authorities.

Keywords: budget deficit; structural characteristics; economic freedom; institutions; cultural paradigm; political freedom.

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