Determinants of National Government Expenditure and Capital Outlay in the Philippines

Date

6-2021

Degree

Bachelor of Science in Economics

College

College of Economics and Management (CEM)

Adviser/Committee Chair

Gideon P. Carnaje

Committee Member

Maria Luisa G. Valera, Gideon P. Carnaje, Maria Angeles O. Catelo, Agham C. Cuevas

Abstract

The size of government expenditure plays a vital role in the economic growth and development of a country and has fiscal implications. This study attempts to examine macroeconomic and structural determinants of national government expenditure and government capital outlay for the period 1972-2018. In the Philippines, the share of national government expenditure in GDP continuously fluctuated over the years while the share of government capital outlay in GDP showed a declining trend; however, both showed a rising trend in recent years. Thus, this peculiar behavior indicates the need for the factors responsible for changes in total government expenditure and government capital outlay. The autoregressive distributed lag model was used for both models. Revenue size and debt share were found to be significant determinants of the size of national government expenditure. Likewise, the findings for government capital outlay reveal that tax revenue positively influences government capital outlay; however, urbanization negatively affects government capital outlay. The study recommends that future studies consider including variables that capture socio-political aspect.

Language

English

LC Subject

Government Expenditures, Capital Outlay, ARDL Model

Location

UPLB College of Economics and Management (CEM)

Call Number

LG 993.5 2021 E2 V53

Document Type

Thesis

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