The Impact of Governance on the Efficiency of Public Spending: "An Empirical study on the Syrian Economy"

Abstract

There are many factors that affect the performance and efficiency of public spending. Governance is a crucial factor in improving the efficiency of government spending because it can change the incentives of allocating the public resources of economic institutions.

This paper studies the relationship between governance (through regulatory quality and government effectiveness) and its impact on the effectiveness and efficiency of public spending (represented by real economic growth) in Syria during the period 2000-2018 using the autoregressive distributed lag ARDL.

The results show an increase of 1% in government effectiveness will lead to an increase by  0.2% in economic growth in the long run, and that there is no relationship between regulatory quality and economic growth. The results also show that economic growth in Syria is consistent with the endogenous growth theory based on technology and human capital.