Public expenditures in areas of public sector: analysis and evaluation in EU countries

Abstract

Public sector, representing a significant part of public economy, is considered one of its supporting pillars. The paper utilises financing of public sector (indicator of the percentage of public expenditures in GDP). It deals with the analysis and evaluation of public expenditures in EU countries according to selected COFOG functions, namely social protection, health, education, culture and recreation, in years 2005 and 2014. Also, three important proportions within total public expenditures are observed in terms of their structure. By means of multidimensional scaling, dissimilarities and similarities in the volume of allocated public resources in EU countries are evaluated with respect to COFOG functions (% of GDP in 2005 and 2014). Results showed that Scandinavian countries and France are among the countries with the best evaluation (most similar) with highest public expenditures. Conversely, Baltic states, Cyprus and Romania (most similar) comprise the second group of countries with the lowest public expenditures. These two sets of countries are least similar in the volume as well as structure of allocated public expenditures in the observed areas of public sector.