№ 9/2017

№ 9/2017

Fìnansi Ukr. 2017 (9): 7–28https://doi.org/10.33763/finukr2017.09.007

PUBLIC FINANCE MANAGEMENT

IEFYMENKO Tetiana ¹

¹SESE “Academy of Financial Management”
OrcID ID : https://orcid.org/0000-0002-9163-3959

Fiscal space and stabilization of public finance

It is noted that the dynamic renewal of the limited reserves of fiscal space for the implementation of sustainable fiscal policy requires the improvement of its instruments, along with changes in the sphere of monetary and foreign exchange regulation. Based on world best practice, the author suggests conceptual approaches to the selection and coordination of the levers of public finance management. This includes orientation in the medium- and long-term perspectives of the targets for the formation of an anti-crisis, stabilizing potential of the national economy. Achieving the goals of sustainable innovation development, ensuring a new quality of life for the population should be accompanied by the stimulation of public-private investment partnership, transparency and accountability in the state procurement of goods and services, as well as in the planning and financing of budget expenditures. Fiscal policy should be directed at supporting the accumulation of tangible and intangible assets of all forms of ownership by reducing the tax burden and using current budget expenditures to expand effective demand. National and targeted programs and projects must provide conditions for the development of particular regions and industries, and correspond with strategic directives to reduce the unemployment rate, improve professional skills and other characteristics of human, infrastructure and technological capital. It is emphasized that against the background of globalization, large-scale financial imbalances create additional sources of threats to the resource strength of fiscal space. Strong imbalance between money and the commodity mass is increased due to the rapid growth of government and business debts, accelerated development of the derivatives market. If the possibility of issuing money to support fiscal equilibrium is used inadequately, it is likely that normal cause-effect relationships between money and inflation are broken. The author emphasizes the need to promote a significant increase in the predictability and stability of the interdependence of the money supply in circulation and the dynamics of nominal GDP through the implementation of monetary policy measures of the state. The positive impact of budget regulatory levers on socio-economic processes has been going on for a lengthy period. More flexible instruments of monetary policy can effectively counter threats posed by high levels of economic uncertainty.

Keywords:fiscal space, stabilizing potential of public finance, fiscal policy, monetary policy, monetary regulation, sustainable development

JEL: H12, H60, H63

Iefymenko T. . Fiscal space and stabilization of public finance / T. . Iefymenko // Фінанси України. - 2017. - № 9. - C. 7-28.

Article original in Ukrainian (pp. 7 - 28)

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