What Is Government Spending?

Government expenditure refers to the payment of various financial funds by a country (or region) for the required goods and services purchased in order to complete its public functions. It is the cost that the government must pay to society.

Government spending

Government expenditure refers to the payment of various financial funds by a country (or region) for the required goods and services purchased in order to complete its public functions. It is the cost that the government must pay to society.

Government spending at all levels consists of two parts, one part is

Government Expenditure by Government Function

Classified by government function, actually by cost category

1. Government expenditure by sector

Government expenditure is classified by sector: budget expenditure can be divided into industrial, agricultural, commercial, transportation, science and technology, education, cultural, and social security expenditures.

The budget expenditure is divided into industrial, agricultural, commercial, transportation, technology, education, cultural, and social security departments. On the one hand, the government's departmental policy guidance can be analyzed. Generally speaking, the government's Those departments invested more, and those sectors underwent rapid development. On the other hand, the budget expenditure was classified by department to directly serve the preparation of departmental budgets.

2.Government expenditure is divided by budget preparation method

According to the budget preparation method, government expenditure can be divided into regular budget expenditure and capital budget expenditure. Recurring budget expenditures refer to the expenditures required to meet the government's daily internal and external functions. These expenditures are generally unpaid expenditures; capital budget expenditures are expenditures invested in the field of social reproduction to form various assets. It can bring profit and tax revenue to the national finance. Dividing budget expenditure into regular budget expenditure and capital budget expenditure can analyze the relationship between the government's performance of basic public management functions and intervention in economic operations.

3. Government expenditure is divided according to the budget management system

Government expenditure is divided according to the budget management system and can be divided into central budget expenditure and local budget expenditure. The central budget expenditure refers to the expenditure of the central government to meet national and cross-regional public goods services, which reflects the degree to which the functions of the central government are realized; the local budget expenditure refers to the expenditure of local public goods services by local governments at all levels. This classification method can analyze the specific situation of governments at all levels in fulfilling their functions, and the relationship of fiscal allocation between governments.