Information on the thesis

The thesis is dedicated to complex theoretical and analytical substantiation of
the influence of fiscal policy on the stability of the currency market of Ukraine.
Practical recommendations regarding the stabilization measures of the national
currency market taking into consideration the changes in dynamics of the main fiscal
levers, such as government revenue, government expenditures and government debt,
within the conditions of the necessity for achieving macro-financial stability of the
national economy are developed. Interpretations of the notions, such as “currency
market” and “macro-financial stability”, are critically investigated; author’s
understanding of the definition of “currency market stabilization” is formulated.
On the basis of theoretical models of fiscal and monetary interaction, the
system of fiscal policy indirect influence factors towards the currency market
condition is determined. Complex analysis of dynamics of the main indices of the
currency market of Ukraine and the main fiscal parameters of the government
finance was carried out. The mechanism of cause-and-effect relationship between
the fiscal policy levers and currency market condition is determined.
Analysis of the Ukrainian currency market formation trends and the main
indices of the fiscal policy testified that although the national currency market is
formed, due to a high level of market dollarization, inefficient budgetary and taxation
and debt policies, ensuring its stability requires substantial and systematic analysis
of a wide range of factors in view of the main indices of fiscal and monetary policies
in the system of government finance management.
By means of economic-mathematical modeling it was proved that higher
government expenditures increase foreign currency long-term demand and
simultaneously limit its sale by the population. Instead, government revenues
increase boosts foreign currency sale, which can be attributed to the need for
compliance with tax liabilities and improvement of confidence in the economy. The
study confirms that economically unjustified government expenditures increase, 21

including due to inefficient debt policy, cannot be the factor of macro-financial
stabilization and currency market stabilization in particular, since it both boosts
foreign currency demand and decreases currency reserves, which weakens guarantees
of financial stability of the state. Amongst the other empirical results, a conclusion
was obtained according to which foreign currency purchase essentially depends on
the volume of its sale in both aspects – short-term and long-term, and foreign
currency demand decrease, due to the Ukrainian hryvnia depreciation or revenues
from those employed abroad, is distinct in the long-term nature.
Empirical estimations prove that government revenues and government
expenditures are independent of the monetary overhang, whereas larger government
revenues limit monetary overhang. This structural feature may be considered as a
sign of fiscal dominance in the Ukrainian economy. It is noteworthy that the sale of a
foreign currency to the population becomes the most important monetary hangover
factor, which becomes limited in the long term due to the government revenues
increase. Simultaneously, monetary overhang limits volumes of the foreign currency
sale and purchase by the population.
Priority guidelines for the government fiscal policy efficiency increase based
on the implementation of moderate fiscal consolidation concept representing the
complex of measures aimed at government expenditures optimization, government
revenues increase and debt loading decrease in order to raise government finance
stability are suggested by the author. Moderate fiscal consolidation policy
implementation consequences will be evident in the debt crisis depth and recession
duration decrease, and will promote national economy dynamic development and
ensure currency rate and macro-financial stabilization in Ukraine.
Key words: fiscal policy, fiscal levers, currency market stability, monetary
policy, fiscal and monetary management, unshadowing, deoffshorization, fiscal
consolidation, macro-financial stabilization.