Institutions and the impact of government spending on growth

James Butkiewicz and Halit Yanıkkaya

Journal of Applied Economics, 2011, vol. 14, 319-341

Abstract: This paper reports the results of a study of the impact of government expenditures on economic growth, emphasizing how government effectiveness influences the efficiency of government spending. The effects of sub-categories of government spending on growth are also examined. Total expenditures are estimated to have negative growth effects for some groupings of developed nations. Consumption expenditures are found to have a detrimental growth effect in developing nations with ineffective governments. Developing nations with ineffective governments benefit from capital expenditures. To stimulate growth, developing nations should limit their governments’ consumption spending and invest in infrastructure.

Keywords: economic growth; institutional quality; government expenditures (search for similar items in EconPapers)
JEL-codes: H5 O11 O23 O50 (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (44)

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Related works:
Journal Article: Institutions and the Impact of Government Spending on Growth (2011)
Working Paper: Institutions and the Impact of Government Spending on Growth (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:cem:jaecon:v:14:y:2011:n:2:p:319-341

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