The Phenomenon of Twin Deficits in Poland in 2009–2018 : Research Paper

• Authors: Izabela Zawiślińska , Piotr Cirin

Abstracts

EN

The purpose of this article is to determine the degree, direction and strength of the impact of the studied variables, i.e. the state budget balance and the current account balance as part of Poland’s balance of payments in the years 2009–2018 based on the data of the Statistics Poland. The main research questions focus on determining the type of relationships connecting the studied deficits and the degree, direc tion and type of interaction in light of previous studies dedicated to the hypothesis of twin deficits. The methodology used is based on inte grated correlation analysis, linear regression and an analysis of the co efficient of variation. As a result of the study, a strong correlation was found between the cumulative values of the examined deficits, con firming the existence of the twin deficit hypothesis in Poland in the examined period; this means that the budget deficit affects the current account balance of payments. The main balance stabilizing the negative balance of primary incomes, in which the income of non-residents from foreign direct investment is the dominant position, was the balance of extremely dynamically developing service exports.

Keywords

EN

twin deficits; budget deficit; balance of payments; international financial relations

• Publisher: Najwyższa Izba Kontroli
• Journal: Kontrola Państwowa
• Year: 2021
• Volume: 66
• Issue: 3 (398)
• Pages: 180-199

Dates

published

2021

Contributors

author

Izabela Zawiślińska

• Collegium of Socio-Economics, SGH Warsaw School of Economics

• https://orcid.org/0000000343187285

author

Piotr Cirin

• Collegium of Socio-Economics, SGH Warsaw School of Economics

• https://orcid.org/0000000313749240

References

• Barro R. J.: Are government bonds net wealth? “Journal of Political Economy”,Vol. 82, nr 6/1974.
• Barro R. J.: Perceived wealth in bonds and social security and the Ricardian equivalence the orem: Reply to Feldstein and Buchanan, “Journal of Political Economy”, Vol. 84, nr 2/1976.
• Budnikowski A.: Ekonomia międzynarodowa: Polskie Wydawnictwo Ekonomiczne 2017.
• Charusheela S.: Structuralism and individualism in economic analysis: the „contractionary devaluation debate” in development economics, London 2013: Routledge.
• Feldstein M., Auerbach A. J.: Handbook of Public Economics (Vol. 4), North Holland 2002: Elsevier.
• Feldstein M. S., Horioka C. Y.: Domestic savings and international capital flows, National Bureau of Economic Research, Cambridge 1979, MA.
• Frankel J. A.: No single currency regime is right for all countries or at all times, Working Paper 7338, September 1999, National Bureau of Economic Research, Cambridge 1999, MA.
• Frankel J. A.: Twin deficits and twin decades. The Macroeconomics of Fiscal Policy. Cambridge 2006, MA: MIT Press.
• Gabrisch H.: On the twin deficits hypothesis and the import intensity in transition coun tries, “International Economics and Economic Policy”, Vol. 12, nr 2/2015, doi:10.1007/ s10368-014-0272-0.
• Ganchev G. T., Stavrova E., Tsenkov V.: Testing the twin deficit hypothesis: The case of Cen tral and Eastern Europe countries, “International Journal of Contemporary Economics and Administrative Sciences”, Vol. 2, nr 1/2012.
• Gandolfo G.: International Economics II – International Monetary Theory and Open Economy Macroeconomics, “International Еconomics II”. Heidelberg 1987, Germany: Springer-Verlag.
• Hallwood C. P., MacDonald R.: International money and finance, Malden 2000, MA: Black well Publishing.
• Johnson H. G.: The monetary approach to the balance of payments: A nontechnical guide, “Journal of International Economics”, Vol. 7, nr 3/1977.
• Kumhof M. M., Laxton M. D.: Fiscal deficits and current account deficits: International Monetary Fund 2009.
• Makin A. J.: International macroeconomics, Melbourne 2002, Australia: Pearson Education.
• Marinheiro C. F.: Ricardian Equivalence, Twin Deficits, and the Feldstein-Horioka puzzle in Egypt, “Journal of Policy Modeling”, Vol. 30, nr 6/2008.
• Misztal P.: Współzależności między deficytem budżetowym i deficytem bilansu obrotów bieżących w Polsce w latach 1999–2009, „Ekonomista”, nr 2/2011.
• Mosayeb P., Saleh A. S.: Budget Deficits and Current Account Deficits in the Philippines: A Casual Relationship? “American Journal of Applied Sciences”, Vol. 6, nr 8/2009.
• Moździerz A.: Paradygmat deficytów bliźniaczych a doświadczenia krajów Europy Środkowo-Wschodniej, Polskie Wydawnictwo Ekonomiczne 2018.
• Mundell R. A.: The appropriate use of monetary and fiscal policy for internal and external stability, “ Staff Papers”, Vol. 9, nr 1/1962.
• Obadić A., Globan T., O. Nadoveza: Contradicting the twin deficits hypothesis: The role of tax revenues composition, „Panoeconomicus”, Vol. 61, nr 6/2014, doi:10.2298/PAN1406653O.
• Parlińska M., Parliński J.: Statystyczna analiza danych z Excelem, Wydawnictwo SGGW 2018.
• Polak J. J.: The monetary model at forty. In: Washington, DC: International Monetary Fund 1997, Working Paper, WP/97/49, Apr.
• Polak J. J.: The two monetary approaches to the balance of payments: Keynesian and Johnsonian, International Monetary Fund 2002, WP/01/100.
• Ricardo D., R. McCulloch J.: The Works of David Ricardo: With a Notice of the Life and Writings of the Author. London 1888: John Murray.
• Romatowski M.: Twin deficits-czy to rzeczywiście bliźniacze deficyty? „Bank i Kredyt”, nr 8/2005.
• Şen H., Kaya A.: Are the twin or triple deficits hypotheses applicable to post-communist countries? Bank of Finland 2016, BOFIT.
• Siddiqui A.: India and south Asia: Economic developments in the age of globalization: Armonk 2007, NY: M.E. Sharpe.
• Strzała K.: Korelacja inwestycji i oszczędności w krajach Unii Europejskiej-weryfikacja empiryczna z zastosowaniem podejścia panelowego, „Prace i Materiały Wydziału Zarządzania UG” 2005.
• Swan T. W.: Longer-run problems of the balance of payments, The Australian Economy: A volume of readings 1963.
• Tumpel-Gugerell G., Mooslechner P.: Economic convergence and divergence in Europe: growth and regional development in an enlarged European Union, Cheltenham, UK 2003: Edward Elgar Publishing.
• Zawiślińska I.: Państwo we współczesnej gospodarce światowej. Wybrane zagadnienia, Kwartalnik Kolegium Ekonomiczno-Społecznego „Studia i Prace”, Vol. 9, nr 1/2012.

Identifiers

DOI

10.53122/ISSN.0452-5027/2021.1.29

Biblioteka Nauki

2048531