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I. Black Sea and The Balkans Economic and Political Studies Symposium
The main goal of economic policy in Central and Eastern Europe - higher economic growth - aiming to reach the
average value of GDP per capita in EU – requires to be found all instruments to influence on the aggregate supply.
This purpose could be reached with monetary and fiscal instruments. The paper researches the public spending
as an instrument to be stimulated the economic growth in new member states of European Union. As known, it
could make with national and with European Union funds (EF) in the countries above. The research focuses on
the public expenses with EF in new member states in Central and Eastern Europe and looks for to calculate the
impact of these spending on the aggregate demand and after to the aggregate supply.
The public spending with European funds distinguishes from such financed with national sources. The specifics
are following:
• The taxation made and taxes collect in the countries, net donors of the budget of EU;
The public spending makes in new member states. It is a conflict of interests, because Gross Domestic Product
(GDP), which European funds from, creates on one place, but spends on other place. Due to it, is very important
for net donors of EU budget to know the effectiveness of funds paid. Because needs of the convergence between
old and new member states, the main measure is significantly reduction of differences of GDP per capita between
donors and new members.
Up to now the model it is tested for public spending with national funds and additionally for public spending with
EF1 in the case of Bulgaria.
Abstract
The main goal of economic policy in Central and Eastern Europe - higher economic growth - aiming to reach the average value of
GDP per capita in EU – requires to be used all instruments to influence on the aggregate supply. This purpose could be reached if it
put in the practice monetary and fiscal instruments. The current research investigates only the impact of fiscal policy to be stimu-
lated the economic growth.
As known, the public spending could make with national and European Union funds in the countries above. The paper researches
the public spending, financed with the EU funds and looks for to calculate the impact of these expenses on the aggregate supply in
new member states of EU.
Keywords:
Public Spending, European Funds, Economic Growth, Central and Eastern Europe
Kamelia Assenova
Associate Professor, PhD, University of Ruse, Ruse, Bulgaria,
[email protected] [email protected]Public Spending, Financed With European Funds and
Its Impact on the Aggregate Supply in Central and
Eastern Europe