UNIVERSITY OF RUSE "ANGEL KANCHEV"
UNION OF SCIENTISTS - RUSE

Proceedings 2024
Faculty of Business and ManagementBook 5.1 · Economics and Management

FRI-2G.404-1-EM2-05

THE IMPACT OF CONSTRUCTION INVESTMENTS ON THE GDP OF BULGARIA

Language: BGPages: 82-87

Cite this paper

Assist. Prof. Galina Ruseva, PhD

Department of Economics and International Relations University of Ruse “Angel Kanchev”

E-mail: gruseva@uni-ruse.bg

Abstract

The paper examines the impact of construction investments on GDP growth in Bulgaria over the period 2009-2022. Data on expenditure on acquisition of tangible fixed assets in buildings and construction equipment from National Statistical Institute (NSI) are used. Applying Autoregressive distributed lag (ARDL) cointegration technique, the study reveals a short-run negative impact of construction investment on the growth in Bulgaria. The short-term elasticity coefficient is statistically significant and exhibits a negative sign. Model diagnostics confirm the stability and causality of the data. Construction investments are characterized by volatility, sensitivity to external shocks, and specific implementation in Bulgaria. To mitigate these short-term adverse effects and achieve sustainable long-term growth, it is crucial to prioritize high-quality, efficient projects that align with the current economic context.

Keywords

economic growth, construction investment, autoregressive distributed lag, expenditure on acquisition of tangible fixed assets in buildings and construction equipment, Bulgaria

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