[The experience of Japan: the application of the intersectoral balance methodology to control health care costs as a factor of mobilization readiness of health care to COVID-19 pandemic].

One of possible reasons for success of Japan in confronting the COVID-19 pandemic (low mortality rates, refusal of hard lock-downs and relatively low fall in economy) is seen in record high (3-4 times higher than in most other developed countries) provision of hospital beds. Its financing was supported during first 2 decades of the XXI century by the policy of relative to GDP advanced growth of public health public expenditures based on assessment of multiplier impact of these expenditures on demand, production and employment in other sectors of the economy using the intersectoral balance method based on "input-output" tables.Purpose of the study is to analyze Japan's economic policy in managing budgetary health care costs.The comprehensive statistical, comparative and retrospective analysis of available data was applied.The study results permit to suggest that high provision of the Japan population with hospital care resources and low mortality rates in 2022 prior to development of vaccines and effective treatment schemes for COVID-19 can be explained, among other things, by long-term policy of managing health care costs using assessment of their effect on production growth, demand and employment in other economy sectors using intersectoral balance method based on regular compilation of "input-output" tables.The data obtained permits to characterize as promising approach of the Japanese government to management of health care costs using assessment of their effect on production growth, demand and employment in other sectors of the economy using intersectoral balance method based on the regular compilation of "input-output" tables. This approach permitted to increase up to 1.5 times health care costs during 2005-2018 in situation of chronic stagnation of the national economy and thus to avoid world-wide trend towards reduction of hospital bed stock and after the start of pandemic severe shortage of hospital beds. The positive experience of Japan is confirmed by encouraging results of 2 pilot projects in the EU countries on applying the intersectoral balance method to assess the multiplier effect of health care costs in 2017-2018. It is considered that using the experience of Japan in managing budgetary health care expenditures through intersectoral balance method is challenging.

Lost in consolidation? Declining public investment, multiplier effects and alternatives to the path of fiscal consolidation in Portugal

This paper deals with one of the most pressing concerns that Eurozone periphery economies will face in the near future: how to achieve a sustained recovery from the COVID-19 crisis while dealing with growing public debt-to-GDP ratios. The paper assesses the macroeconomic relationship between public spending, economic growth and debt sustainability. We use a TSLS method to perform the econometric estimation of the public spending multiplier for a panel of 11 Eurozone economies over the 1995-2019 period. We find evidence that the multiplier is positive and close to 1,8, suggesting that the benefits of promoting public investment exceed its initial financing cost. As a result, we conclude that debt sustainability is not only compatible with, but in fact improved by a more expansive fiscal policy and present an alternative policy path for the Portuguese economy in the 2021-2025 period based on this conclusion.

Fiscal multipliers in the COVID19 recession.

In response to the record-breaking COVID19 recession, many governments have adopted unprecedented fiscal stimuli. While countercyclical fiscal policy is effective in fighting conventional recessions, little is known about the effectiveness of fiscal policy in the current environment with widespread shelter-in-place ("lockdown") policies and the associated considerable limits on economic activity. Using detailed regional variation in economic conditions, lockdown policies, and U.S. government spending, we document that the effects of government spending were stronger during the peak of the pandemic recession, but only in cities that were not subject to strong stay-at-home orders. We examine mechanisms that can account for our evidence and place our findings in the context of other recent evidence from microdata.

DOES THE COVID19 PANDEMIC CHANGE THE RELATIONSHIP BETWEEN GOVERNMENT EXPENDITURES AND ECONOMIC GROWTH IN AZERBAIJAN?

This paper investigates the impact of the Government's capital and current expenditures on economic growth in Azerbaijan. The estimation strategy of the research consists of two directions. First, all estimation approaches were used for the period of 2005Q1-2019Q4. The estimated model for this period is called Model 1. Second, the model which is called Model 2 was estimated for whole period of 2005Q1 2021Q1. This approach allows comparing the role of the Government expenditures on non-oil economic activity in normal times and during the COVID-19 pandemic in Azerbaijan. Estimations show that coefficients characterizing the impact of Government current expenditures and capital expenditures on non-oil economic growth are almost the same for both periods. Therefore, we can state that COVID-19 pandemic did not affect the structure of the relationship between Government expenditures and non-oil economic growth. Results show that 1 percent increase in capital and current expenditures of state budget increases the real non-oil GDP by 0.10 and 0.40 percentage points, respectively. Accordingly, both capital and current expenditures of the state budget have positive impact on the real non-oil GDP growth for the both periods. This is in contrast to findings in the literature, which argue that increasing current expenditures financed by tax hikes lead to a lagged decrease in private investment, having an overall negative impact on economic growth. We attribute this opposing finding to the Azerbaijani state budget revenue system, which is financed by transfers from the State Oil Fund (Stabilization Fund). Thus, large government investment and social projects mostly rely on non-tax sources. Therefore, we argue that positive impact of capital and current expenditures of government budget on non-oil GDP seems plausible for Azerbaijan. Another result of our estimation is that expansion of economic openness accompanied by non-oil economic growth plunge in Azerbaijan. We interpret this phenomenon with very low share of non-oil export, where openness is mostly caused by increase in import volume.