IS THERE A CORRELATION BETWEEN GOVERNMENT EXPENDITURES, POPULATION, MONEY SUPPLY AND GOVERNMENT REVENUES?

Public revenues have been the subject of a long debate. Meeting the demand for public financial resources is influenced by a combination of economic, social, demographic, monetary, political, military, psychological factors. There are many factors which determine more or less changes in government revenues. We have focused our attention on the government expenditures, population and money supply in order to quantify the degree of correlation with public revenues. This paper intends to measure the intensity of the relationship between these three factors and governments revenues. The paper aims to be an answer to the question from title, namely which is the strongest determinant of government revenues: government expenditures, population or money supply? Can government revenues be estimated starting from these three macroeconomic indicators? If the correlation between these indicators is very strong the paper intends to translate it in an econometric model by using unifactorial and linear regression