H5 - National Government Expenditures and Related PoliciesReturn

Starting from endogenous growth models we test the impacts of both taxes (distortionary and non-distortionary) and expenditures (taking into account economic and functional classification of general government expenditure) using the government constraint. We do not neglect the implicit financing assumptions built into the specification of regression utilising both control and fiscal variables. Static and dynamic panel analysis (fixed effects model) of the 25 EU countries covers the period 1995-2008 for the majority of observations. Forward looking moving averages of the growth rate of GDP (2-5 years) are the dependent variable. We find that productive government expenditure supports growth, whilst non-productive expenditure, especially social protection (COFOG) or social payments (Ameco) does not. Distortionary and indirect taxes reduce economic growth.

The paper is concerned with the microeconomic foundations of fertility, analyzing three approaches: the Chicago approach, the Pennsylvanian approach and Julian Simon's approach. The paper highlights the Chicago tradition that perceives children as either consumer goods or capital goods. The approach of Julian Simon to fertility in developing countries is discussed. The article assumes that people decide about their children rationally.

In the last years there has been a growing discrepancy between gross domestic product and gross disposable income (more than a double of government budget deficit in 2006)in favour of non-residents. The difference between the real interest rate and the rate of growth of GDP has been negative in 2000-2006 and is expected to be negative in the near future suggesting that even a small deficit in primary budget balance can stabilize the debt ratio (30 % of GDP). But in a world of uncertainty even in the Czech republic the capital sector is on net a spout and not a sink (the profit rate has been higher than the investment rate in 1995-2008). Hence the czech economy seems to be dynamically efficient and an increase in national saving is necessary.

The study focuses on evaluation of institutional quality in European Union countries and its possible impact on economic performance and competitiveness. The text stems from the theoretical framework of new institutional economics, especially historical and comparative institutionalism, and it bases on the concept of good governance. The source of the evaluation is the scheme of the World Bank Governance Matters, supplemented with research of other institutions working with individual institutional characteristics. Authors evaluate following characteristics - voice and accountability, political stability, government effectiveness, regulatory quality, rule of law and control of corruption, which together form aggregate indicator of institutional quality. Old member countries of European Union (EU-15) are classified into different models of capitalism according to their different institutional quality. Institutional changes in new member countries (EU-10, eventually EU-8) in period 1996-2004 illustrate both institutional adjustment of postcommunist countries and dynamics of these changes and their convergence to different types of capitalism.

We evaluate the economic impact of Summer Olympic Games (SOG) potentially organized by the City of Prague in 2016. We focus on the so called Modified Northern Variant of the Games proposed by the PriceWaterhouseCoopers-Czech Republic. The first step in our analysis is quantification of a primary impact of the Games, which includes investments in infrastructure, expenditures of the SOG Organizing Committee, tourist expenditures and exports. The primary impact induces an increase in overall sales in the Czech economy, which is analyzed using input-output tables. Our respective estimates are 27.54 billion CZK for the primary impact and 55.44 billion CZK for the secondary impact.