Government size, composition, volatility and economic growth

Antonio Afonso and Davide Furceri

European Journal of Political Economy, 2010, vol. 26, issue 4, 517-532

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)
Date: 2010
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Citations: View citations in EconPapers (231)

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Related works:
Working Paper: Government size, composition, volatility and economic growth (2008)
Working Paper: Government Size, Composition, Volatility and Economic Growth (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:poleco:v:26:y:2010:i:4:p:517-532

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