An Investigation of Trend and Compositions of the Government Expenditure in Bangladesh

Abstract

In Bangladesh, the government spending policies of the national budgets have been assigned a key role in the economic development and growth process. However, they could have detrimental ramifications if obscurely managed. Thus, the nature and degree of this expenditure and revenue patterns determine the overall quality of the government finances in Bangladesh. The main aim of the present study is to evaluate the changing patterns of the heads of expenditures, their trends and compositions over the period of 1975-2015.  This paper is mainly based on tabular representations. However, some statistical tools also have been used when necessary. It is revealed from the study that although government spending increases steadily, but the composition and patterns of government spending has changed dramatically. The sharp increase in the total government spending is mainly because of continuous increase in revenue expenditure which created serious imbalances in the fiscal sector of the economy. Thus, it is evident from the study that although total public expenditure is rising in Bangladesh, development expenditure actually squeezed in the country to maintain rising revenue expenditures. In addition, sector-wise allocations to public resources have been reduced for some key sectors that are directly productive in nature like agriculture and manufacturing industry. At the same time, increased proportional allocations of resources to sectors like education and health have been realized.

Keywords: Government expenditure, Revenue Expenditure, Development Expenditure.