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The role of general government in the income redistribution in the Polish economy

Vol. 8, No 2, 2015

Łucja  Tomaszewicz

 

University of Lodz Poland

 

ltomasz@uni.lodz.pl

The role of general government in the income redistribution in the Polish economy

 

Joanna Trębska

 

University of Social Sciences, Lodz Poland

 

 joannatrebska@o2.pl

Abstract. The paper focuses on the analysis of the revenue and expenditure of general government, and in particular redistributive transactions among this sector and the remaining, institutional sectors in the economy. The scope of these relations defines the role of the state in the income distribution in the economy. The empirical part of the paper pro- vides an analysis of the effects of the redistributive functions of the state, based on the sequence of current and capital accounts for general government in Poland. Moreover, an attempt is made to evaluate the activity of this sector in Poland compared to other EU countries. In general, the scope of state interference in economy, measured by the ratio of public spending to GDP is relatively low in Poland (and in most new EU-member states) compared to the EU average. The analysis of the similarity of structures indicates that in general, the structure of government revenue and expenditure in the EU countries are similar. Much bigger differences between these countries exist in the structure of revenues than expenditures. Differences in the structure of general government’s revenue in individual countries result mainly from the regulations of tax systems and social security systems (especially specific in Nordic countries). Thus, the structure of current resources of general government in Poland is the most similar to the structures observed in Eastern European countries. A similar demographic situation in Europe means that the structures of transfer payments (largely dependent on it) are also very similar. The share of consumption in the sum of current expenditures of government (i.e. transfer payments and consumption) is on average twice as high in EU than in Poland. The increase in the participation of government sector in the investments process is clearly visible in Poland. The share of this sector’s gross fixed capital formation in investments expenditures is much higher than European average and in 2005-2013 was the highest in Europe.

 

Received: April, 2015

1st Revision: May, 2015

Accepted: July, 2015

 

 

 

 

 

DOI: 10.14254/2071-

8330.2015/8-2/8

JEL Classification: E01, E02, H11, H2, H5, H6

Keywords: government, national accounts, public finance