Appropriate Budgetary Policy for a Changing Economy

Abstract

The XXI century's contemporary challenges and crises indicate that fiscal policy is an appropriate tool for countercyclical regulation, ensuring sustainable economic growth and social justice. In this regard, society's requirements for the quality of budgetary policy have changed, which has shifted the focus in setting goals and choosing tools for its implementation from the position of ensuring sustainable economic growth and the principles of fair distribution of income. The analysis allows us to conclude that to ensure the proper quality of budgetary policy, its goals and objectives must correspond to the strategic goals of developing public law education, and coordination of budgetary and monetary policy is necessary. To achieve the goals of justice, the author of the article propose to differentiate the instruments of inter-budgetary reallocation of funds depending on the level of debt sustainability of the regions and to use targeted grants to motivate the authorities of public law entities to ensure sustainable socio-economic development. The article shows that for improvement of the formation mechanism of state programs and national projects and budget efficiency growth, it is necessary to monitor the compliance of tax expenditures and budget subsidies with the target indicators of state programs.

Innovative Strategy for Selecting Industries for Program-Target Stimulation of Regional Economic Diversification

“…The related question of whether states or markets should be the key agents of structural transformations and economic development is a hotly debated topic. In recent decades, a consensus has emerged: the golden mean between an emphasis on market forces and reasonable government intervention may be necessary to overcome both market upsets and failures, as well as government failures [17][18][19]. It is necessary to provide incentives to facilitate the processes of development and growth for new types of activities, such as technologies or products that are novel to the domestic economy [14,20].…”

Program-Target Mechanisms to Ensure the Fiscal Balance of the Federal Constituent

“…In this regard, some publications substantiate the need to improve program-targeted mechanisms, including the provision of subsidies within the framework of state programs and national projects, to ensure sustainable socioeconomic development of the regions [29] and the transformation of the inter-budgetary transfer system for ensuring fiscal balances of federal constituent entities [30]. As it was rightly highlighted by Braginsky et al [31], on the one hand, spending on social projects is a necessary budget expenditure item; on the other hand, achieving the necessary balance by simultaneously increasing the number and improving the quality of commercial projects is hindered by limited budgetary funds, a formal approach to the procedure of tendering commercial projects applying for inclusion in state programs, and problems with assessing the socio-economic efficiency of state programs.…”