Budget Transparency and Good Governance for Human Development and Citizens’ Well-Being. New Empirical Evidence from the European Union

Raluca Mihaela  Drăcea; Marilen Gabriel Pirtea; Mirela Cristea; Gratiela Georgiana Noja; Laura Ciobanu

doi:10.5755/j01.ee.35.3.34024

Authors

Raluca Mihaela Drăcea Faculty of Agrifood and Environmental Economics, Bucharest University of Economic Studies, Romania
Marilen Gabriel Pirtea Faculty of Economics and Business Administration, West University of Timisoara, Romania
Mirela Cristea Faculty of Economics and Business Administration, University of Craiova, Romania
Gratiela Georgiana Noja Faculty of Economics and Business Administration, West University of Timisoara, Romania
Laura Ciobanu Faculty of Agrifood and Environmental Economics, Bucharest University of Economic Studies, Romania

DOI:

https://doi.org/10.5755/j01.ee.35.3.34024

Keywords:

Budget Transparency, Good Governance, Human Development, European countries, Econometric modelling

Abstract

This paper aims to study the synergies between budget transparency (proxied through the Open Budget Index) and good governance (measured through each of the 6 Worldwide Governance Indicators), with overall effects on human development (measured by the Human Development Index). Based on the literature underpinnings, most of the previous studies were based either on the bidirectional analysis of the influences exerted by budget transparency on the 6 pillars of governance, or on studying the relationship between good governance and the development prospects of states. Therefore, our study highlights the influences exercised on the level of human development, documenting the simultaneous causality of our coordinates, within the selected states. The sample includes 14 EU member states, selected according to the availability of reported budget transparency, for the period 2006-2021. The research methodology embeds a three-fold approach that relies on advanced modeling through robust regression models, structural equations modeling and Gaussian Graphical Models. The obtained results suggest that improving governance and human development can help promote budget transparency, and greater budget transparency can support better governance and higher human development by ensuring efficient use of public resources, considering the political factor as well.

Author Biographies

Raluca Mihaela Drăcea, Faculty of Agrifood and Environmental Economics, Bucharest University of Economic Studies, Romania

Raluca Mihaela Drăcea is an Associate Professor at the Bucharest University of Economic Studies (Romania), Faculty of Agri-Food and Environmental Economics. She has a degree in Banking Finance from the University of Craiova, where she also obtained the scientific title of PhD in Economics. Since 2021, she has been habilitated in Economics at the Bucharest University of Economic Studies. Her areas of interest are green finance and business finance.

Marilen Gabriel Pirtea, Faculty of Economics and Business Administration, West University of Timisoara, Romania

Marilen Gabriel Pirtea has been the Rector of the West University of Timisoara since 2012 (after being Chancellor, Vice-Dean and Dean of the Faculty of Economics and Business Administration in Timisoara). He is a professor and doctoral adviser in the field of finance, and his main interests are company financial management, direct investment and business financing, international finance, and corporate governance. He is the principal author of 4 books, co-author of 13 books, and author or co-author of more than 150 scientific articles and studies, and manager or part of the teams of 35 research projects.

Mirela Cristea, Faculty of Economics and Business Administration, University of Craiova, Romania

Mirela Cristea is a Professor at the University of Craiova (Romania), Faculty of Economics and Business Administration, Department of Finance, Banking and Economic Analysis. Her main research directions and teaching activities are Insurance and Private pension funds, Banking administration, and Interdisciplinary research in economics. She obtained the scientific title of PhD in Economics at the University of Craiova. She graduated from the Post-Doctoral School in Economics and Applied Sciences in Economics at the Romanian Academy of Bucharest with a PhD habilitation in Economics. In addition, she is a reviewer and member of the scientific and organizational committees for numerous journals and conferences.

Gratiela Georgiana Noja, Faculty of Economics and Business Administration, West University of Timisoara, Romania

Gratiela Georgiana Noja is an Associate Professor at the West University of Timisoara (Romania), Faculty of Economics and Business Administration, Department of Marketing and International Economic Relations. She completed her studies at the West University of Timisoara with a PhD habilitation and PhD in Economics, a Master in Management and European Integration, and a BA in International Economic Relations. Her main research and teaching activities are developed within the Economics and International Business area, focusing on World Economy, Globalization, and European economic integration.

Laura Ciobanu, Faculty of Agrifood and Environmental Economics, Bucharest University of Economic Studies, Romania

Laura Ciobanu is an Assistant Professor at the Bucharest University of Economic Studies (Romania), Faculty of Agri-Food and Environmental Economics. Her main research activities are developed within the framework of Economics.