PUBLIC PUBLIC SECTOR EXPENDITURE AND SUSTAINABLE DEVELOPMENT: AN EMPIRICAL ANALYSIS OF AND DEVELOPING COUNTRIES

Belanja sektor publik dan pembangunan berkelanjutan: analisis empiris Negara-Negara maju dan berkembang

Abstract

This study aims to analyze the relationship between public sector spending and sustainable development in developed and developing countries. Using panel data from a number of countries divided into two categories, this study examines the effect of government spending in various sectors (such as education, health, infrastructure, and environment) on sustainable development indicators, including quality of life, poverty reduction, and environmental protection. The analysis method used is panel data regression with fixed effects and random effects approaches. The results of the analysis show that public sector spending focused on the social and environmental sectors has a significant positive impact on sustainable development, although the impact varies between developed and developing countries. In developing countries, increased public spending in the infrastructure and health sectors contributes more to achieving sustainable development. Conversely, in developed countries, focusing on environmental management and education has proven to be more effective. This study suggests the importance of adaptive fiscal policy to maximize the positive impact of public spending on sustainable development according to the economic and social conditions of each country.