Further Evidence on Public Spending and Economic Growth in East Asian Countries

Saten Kumar

MPRA Paper from University Library of Munich, Germany

Abstract: This article examines Wagner’s Law for East Asian countries (China, Hong Kong, Japan, Taiwan and South Korea) for the period 1960 to 2007. Using the Gregory and Hansen (1996a & b) structural break techniques, we find a cointegrating relationship between real government spending and real income. Our preferred Gregory and Hansen models are with the level shift for Hong Kong and Taiwan and regime shift (change in intercept and slope coefficients) for China, Japan and South Korea. The income elasticity of government spending ranges from 0.756 to 1.155. With these findings, we infer that Wagner’s Law does hold for these countries, except for Hong Kong where the income elasticity is not highly statistically significant.

Keywords: Real Government Spending; Real Income; Gregory and Hansen Structural Break Techniques. (search for similar items in EconPapers)
JEL-codes: C22 H50 (search for similar items in EconPapers)
Date: 2009-10-20
New Economics Papers: this item is included in nep-fdg and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/19298/1/MPRA_paper_19298.pdf original version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:19298

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().