Empirical Evidence for “Wagner’s Law of Increasing Government Activity” for Austria

Reinhard Neck () and Johannes Jaenicke ()
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Johannes Jaenicke: Alpen-Adria-Universität Klagenfurt

A chapter in Gustav von Schmoller and Adolph Wagner, 2018, pp 153-173 from Springer

Abstract: Abstract In this paper, we discuss what is known as “Wagner’s Law”, a proposition stated by Adolph Wagner relating to the long-run increase in government activities. We discuss problems of specifying and testing it and report on several tests for Austria, both for the Austrian part of the Habsburg Monarchy before World War I and the Second Republic of Austria after World War II. In neither period can we find evidence for Wagner’s Law. Instead, the growth in public expenditures in recent times seems to be driven by a discrepancy between wages and prices in the public sector as opposed to those in the private sector, as follows from Baumol’s “Cost Disease” hypothesis.

Keywords: H500; B310; O520; N130; Government expenditures; Adolph Wagner; Austria; Economic history (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:spr:euhchp:978-3-319-78993-4_11

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DOI: 10.1007/978-3-319-78993-4_11

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