DOMESTIC AND INTERNATIONAL SOURCES OF FUNDING ECONOMIC DEVELOPMENT OF SERBIA

Abstract

Developing countries apply appropriate models and sources of financing economic growth and development. Serbia had different models of economic growth and development. By 2010, it had a model which was based on foreign investment and borrowing, then a model which is based on domestic savings. The aim of this paper is to present the structure and role of national and international sources of funding for economic development of Serbia for the period 2005-2015. The results show that domestic savings has a positive impact on economic growth in the observed period and during period before the economic crisis also affects the reduction of unemployment rate, there is no statistically significant effect of FDI on economic growth and development that remittances have no impact on economic growth but have a positive impact on the individual components of economic development. Financial aids and loans have a positive impact on economic growth and development in the short term.