The effect of social security spending on economic growth in selected EU candidate countries

Abstract

The concept of social security – a contemporary, global norm – and the accompanying public expenditures are the products of a search for security against the dangers that may be faced by individuals in society. Social security spending is affected by social changes, including employment policies, labour supply, family and social structures. Countries give greater importance to social security spending for the sustainability of economic growth. This study analyses and evaluates the impact of social security spending in Turkey, Serbia, North Macedonia and Albania, which are within the scope of European Union enlargement policy, on economic growth in the 1996-2020 period. Panel data analysis was made using the growth rate of gross domestic product per capita, the population growth rate, the corruption index, contribution data on social spending and the Arellano and Bover / Blundell and Bond System Generalized Method of Moments estimator were taken into account. We conclude that social security spending positively affects economic growth and, in this context, it is in line with the theory put forward by Keynes.