Governmental Expense, Tax Revenue and Total Tax Rate Effects on GDP in Global Economic Crisis: An Econometric Cross Sectional Approach

The global economic crisis started in 2008 affected almost all the countries in the world and almost all activity sectors. Numerous studies have attempted to explain the appearance and the development of this unanticipated phenomenon. Our study researches the effect of amplification/reduction of the crisis considering the level of governmental expenses, tax revenue and total tax rate. The sample includes 114 countries from all the continents. The results show significant effects of the explanatory variables, both at the starting of a crisis and in the next years. Though, the values of R2 are relatively low, which confirms once more that the phenomenon is very complex and must be treated all over.