Authors: Aleksandr V. Gevorkyan
Addresses: The Paul McGhee Division, New York University, 726 Broadway, 6th Floor, New York, NY 10003, USA; Capco, 120 Broadway, 29th Floor, New York, NY 10271, USA
Abstract: This paper views fiscal policy as an instrument of sustainable development during ongoing economic transformation. Empirically testing fiscal policy sustainability, this study focuses on primary surplus to debt relation for two transition economies groups: net exporters and net importers. Although results suggest sustainability, mainly for net exporters, recent successes may not be sustainable in the near term, due to structural problems and debt accumulation among others. As a policy tool, this paper introduces a concept of fiscal net with alternative revenue sources. Overall fiscal policy in the CIS must be proactive and pragmatic for the sake of economic development and competitiveness. Proposed infrastructure development fund and strategic learning innovative system, among others, aligned with the real economy's demands, are just few examples of such sustainable fiscal policy targets.
Keywords: fiscal policy; Henning Bohn; fiscal sustainability test; transition economies; fiscal net; sustainable development; primary surplus; infrastructure development funds; strategic systems; innovative systems; net exporters; net importers; economic transformation; structural problems; debt accumulation; alternative revenue sources; CIS; Commonwealth of Independent States; Soviet republics; Soviet Union; Armenia; Azerbaijan; Belarus; Kazakhstan; Kyrgyzstan; Moldova; Russia; Georgia; Russian Federation; Tajikistan; Turkmenistan; Ukraine; Uzbekistan; proactive policies; pragmatic policies; economic development; competitiveness; strategic learning; economic demands; society; systems science; economic recovery; economics; opportunities; challenges.
International Journal of Society Systems Science, 2012 Vol.4 No.1, pp.55 - 75
Available online: 06 Feb 2012 *Full-text access for editors Access for subscribers Purchase this article Comment on this article