Government Spending in Albania: An Overview

The paper is intended to study the expenditure of the Albanian government for the period 2005-2015. The analysis follows the actual state of spending in two perspectives: at a general level and by economic function. Quantitative methods are used to forecast the dynamics of expenditure up to 2020 as well as to estimate the effects of the capital expenditure on economic growth. The empirical results show effects on the growth in Albania close to this of the EU-27. The suggestions for reforms in government spending are in line with an increase and improvements in the efficiency. The analysis found that capital expenditure and spending on education are the most appropriate spending items for an increase on the road to the EU membership. Keywords: government expenditure, capital expenditure, economic function.