Abstract
The article examines the role of the budget component of Ukraine’s fiscal policy in macroeconomic growth. The directions of increase of economic growth under the influence of financial decentralization are offered. The expediency of using multifactor economic and mathematical modelling in the study of the dynamics of the national accounts of Ukraine under the influence of indicators of the budget component of fiscal policy is substantiated.
 The purpose of this study is to investigate the dynamics of national accounts under the influence of the budget component of fiscal policy in the context of financial decentralization. A number of methods have been widely used in the study, including economic and mathematical modelling, correlation-regression analysis, factor analysis, and so on. These methods will underpin the development of strategic prospects for economic growth of the Ukrainian economy under conditions of financial decentralization.
 It is substantiated that an increase in the share of local budget expenditures in consolidated budget expenditures and a decrease in the share of state budget expenditures in GDP lead to an increase in the physical volume index of GDP and an increase in GDP in actual prices. It is also proven that the share of local budget expenditures in consolidated budget expenditures has an immediate direct impact on the GDP physical volume index.
 Another significant factor of direct influence on the GDP physical volume index is identified – the share of capital expenditures (development expenditures) in local budgets, as one of the indicators of financial decentralization efficiency. It is substantiated that the share of state budget expenditures in consolidated budget expenditures is a factor of inverse effect on GDP (in actual prices), and the share of capital expenditures is a factor of direct influence.
 It is proved that financial decentralization in Ukraine is an important factor of economic growth of the Ukrainian economy, as the increase of the share of local budget expenditures in the consolidated budget expenditures and the reduction of the share of state budget expenditures in GDP lead to an increase in the GDP physical volume index and an increase in actual GDP.
Highlights
The allocation and redistribution of state financial resources in the form of budget expenditures is an integral part of fiscal policy
From the data of formula (2) it can be seen that when the share of capital expenditures in local budget expenditures increases by 1 %, the level of the gross domestic product (GDP) physical volume index increases by 1,16 %, the increase of the share of expenditures of the consolidated budget in GDP causes an increase the GDP physical volume index by 0,36 %, while the share of local budget expenditures in the consolidated budget expenditures by 1 %, the GDP physical volume index grows by 1,8 %
From the data of formula (3) it can be seen that as the volume of consolidated budget expenditures increases by UAH 1 billion, the GDP in actual prices increases by UAH 2,75 billion, the increase of the share of state budget expenditures in GDP by 1 % causes a decrease in volume GDP at actual prices by UAH 13,4 billion, while the share of local budget expenditures in the consolidated budget expenditures increasing by 1 %, the physical volume index of GDP increases by UAH 3,55 billion
Summary
The allocation and redistribution of state financial resources in the form of budget expenditures is an integral part of fiscal policy. There is a problem with the financing of public expenditures — whether the funds spent will contribute to economic development. Marchand (1997), who examined the impact of fiscal competition on the level of public expenditures [1]; A. Todtenhaupt (2018), who conducted a theoretical analysis of the impact of changes in the initial level of public debt on fiscal competition and the location of firms [4]; P. Ivanova (2017), who examined the effectiveness of fiscal consolidation tools in the process of balancing public finances [7]; R. Kalinovskyi (2018), who developed recommendations for improving the efficiency of public spending as a tool of state influence on the economy [8] and others — are devoted to the basic theoretical and methodological principles and applied aspects of the place of state expenditures in fiscal policy
Sign-in/Register to view highlights & summary Sign-in/Register to access full text options 
Free) 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call
