The Impact of Government Policy and Transition Reforms on Economic Growth – The Case of Kosovo

Abstract

In this research paper is analyzed the impact of government policy and transition reforms on Economic Growth (in Kosovo) in period of time 2011 - 2014. The variables that are used are as following: economic growth (as dependent variable), corruption index, political stability, exchange rate, transition reforms, control of corruption, and labor market (as independent variables). The data collections are from international and domestic institutions. They are used and calculated through STATA program. The main objectives in the research paper are as following: What is the effect of these factors in economic growth during period time of research? What is the impacted of corruption and control of corruption in economic growth? What is the stimulation of economic growth by government effectiveness, transition reforms and labor market? How much is the correlation between economic growth? The data are calculated by different regression methods: descriptive statistic, OLS method of regression, correlation matrix. In OLS method, the result shown that only transition reforms have positive impact on economic growth but all other reforms have negative impact. Based on this all variables in T-statistic analysis have shown negative significance (T<2) on economic growth. In correlation matrix, transition reforms and government effectiveness have shown positive correlation excluding all other variables that have shown negative correlation with economic growth.

DOI: 10.5901/ajis.2015.v4n1s2p165