Government Size, Composition, Volatility and Economic Growth
Antonio Afonso and
Davide Furceri
No 2008/04, Working Papers Department of Economics from ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa
Abstract:
This paper analyses the effects in terms of size and volatility of government revenue and spending on growth in OECD and EU countries. The results of the paper suggest that both variables are detrimental to growth. In particular, looking more closely at the effect of each component of government revenue and spending, the results point out that i) indirect taxes (size and volatility); ii) social contributions (size and volatility); iii) government consumption (size and volatility); iv) subsidies (size); and v) government investment (volatility) have a sizeable, negative and statistically significant effect on growth.
Keywords: Fiscal Policy; Government Size; Fiscal Volatility; Economic Growth. (search for similar items in EconPapers)
JEL-codes: E62 H50 O40 (search for similar items in EconPapers)
Date: 2008-01
New Economics Papers: this item is included in nep-mac
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Citations: View citations in EconPapers (49)
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Related works:
Journal Article: Government size, composition, volatility and economic growth (2010)
Working Paper: Government size, composition, volatility and economic growth (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:ise:isegwp:wp42008
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