THE RELATIONSHIP BETWEEN PUBLIC EXPENDITURES AND ECONOMIC GROWTH: A PANEL VAR APPROACH

The relationship between public expenditures and economic growth has accelerated, especially after the First World War. In this study, it was investigated using data from 1989-2017 for BRICS countries and Turkey for the causality relation between public expenditures and economic growth. As a result the causality test show that there is no causality from public expenditures to economic growth in the short term but there is causality relationship from economic growth to public spending. In the long run, it is seen that there is bidirectional causality both from public expenditures to economic growth and from economic growth to public expenditures