The impact of public expenditure on economic growth in Vietnamese localities:  Research in the context of the impact of Covid-19

Phan Thi Hang Nga; Pham Minh Tien

doi:10.46223/HCMCOUJS.econ.en.14.1.2565.2023

14(1)2024

The impact of public expenditure on economic growth in Vietnamese localities: Research in the context of the impact of Covid-19

Author - Affiliation:

Phan Thi Hang Nga - University of Finance - Marketing, Ho Chi Minh City , Vietnam

Pham Minh Tien - University of Finance - Marketing, Ho Chi Minh City , Vietnam

Corresponding author: Pham Minh Tien - phamtienidr@ueh.edu.vn

DOI:10.46223/HCMCOUJS.econ.en.14.1.2565.2023

Submitted: 19-10-2022
Accepted: 15-12-2022
Published: 30-06-2023

Abstract

The article studies the impact of provincial public expenditure on economic growth in Vietnamese localities in the context of the impact of Covid-19, with balance panel data of 63 provinces and cities collected in the period 2012 - 2021 (Covid-19 pandemic from 2020 to 2021). The results of the model estimate using the least feasible squared method show that public spending positively impacts economic growth in localities even in the context of the impact of Covid-19. The presence of Covid-19 has had a strong negative effect on economic growth in localities considering both the number of infections and the period of infection and has significantly reduced the impact of public expenditure, extra-budget investment, and human resources. This result is consistent with the actual situation in Vietnam during the Covid-19 pandemic. An interesting finding of the study is that the negative impact of corruption on local economic growth has decreased significantly in the context of the impact of Covid-19. Therefore, improving the efficiency of public expenditure, attracting extra-budget investment, and promoting the efficiency of local labor resources are still important to contribute to promoting economic growth in Vietnamese localities.

JEL codes

O10; O11; O16

Keywords

Covid-19; economic growth; provincial public expenditure; Vietnam

Full Text:

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Cite this paper as:

Phan, N. T. H., & Pham, T. M. (2024). The impact of public expenditure on economic growth in Vietnamese localities: Research in the context of the impact of Covid-19. Ho Chi Minh City Open University Journal of Science – Economics and Business Administration, 14(1), 53-67. doi:10.46223/HCMCOUJS. econ.en.14.1.2565.2024

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DOI: https://doi.org/10.46223/HCMCOUJS.econ.en.14.1.2565.2023