Abstract
The slowdown in economic development caused by the reduction in the efficiency of the functioning of state institutions determined the focus of the governments of most countries of the world on achieving sustainable economic growth, as well as ensuring macroeconomic and macrofinancial stability. A major issue that is dealt with is the weakening of the interaction of monetary and fiscal policies in Ukraine. It can be assumed that one of the reasons hindering economic growth is growing discoordination between monetary and fiscal policies. The purpose of this study is to assess the nature of monetary and fiscal policies in Ukraine in 2000–2017 and justify the need for coordination between them to stimulate economic growth. For the quantitative assessment of the influence of monetary and fiscal factors on GDP, the models of autoregression with distributed lags – ARDL are used. The analysis makes it possible to distinguish and characterize three stages of combining the rigid and stimulating monetary and fiscal policy in Ukraine in 2000–2017. The article examines the influence of the dynamics of the monetary aggregate M3, the inflation rate and the weighted average base interest rate on the growth rates of real GDP in Ukraine, the impact of using the “monetary clamp” effect on the increase in the NBU’s interest rate, and the direct effect of monetary factors on the fiscal policy. The authors conclude that the inconsistency of monetary and fiscal policies is one of the reasons for the high volatility of macroeconomic indicators. The article substantiates the conclusion that it is necessary to overcome the increasing antagonism between monetary and fiscal policies in Ukraine and to strengthen their coordination.
Highlights
After the global financial crisis of 2008–2009, the governments of most countries of the world pay special attention to maintaining sustainable rates of economic growth and ensuring macroeconomic and macro-financial stability
In the EU countries, the growth rate of GDP decreased from 2.5% in 2010 to 2.1% in 2017, and in developing economies the growth rate of GDP decreased from 5.8% in 2008 to 4.8% in 2017
At the third stage (2014–2017), the NBU’s mone- deficit increased and the govtary policy was characterized by a significant in- ernment borrowing increased, the ratio of crease in the key interest rate, a de- which to GDP in 2013 was 40.1%
Summary
After the global financial crisis of 2008–2009, the governments of most countries of the world pay special attention to maintaining sustainable rates of economic growth and ensuring macroeconomic and macro-financial stability. The world and the regional financial and banking crises, as well as trade wars exacerbate the situation, increasing the instability of both government finances and banking systems, which holds back economic growth. In 2017, in the G20 countries, economic growth rates were only 3.13%. The state’s economic policy, which includes the central bank’s monetary policy and the government’s fiscal policy, is aimed at solving the problem of ensuring sustainable growth. The world has accumulated considerable experience in implementing government strategies to stimulate economic growth, but common approaches for all countries have not yet been developed
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