Back to Search
Start Over
The long-term impact of public expenditures on GDP-growth
The long-term impact of public expenditures on GDP-growth
- Source :
- Society and Economy. 42:403-419
- Publication Year :
- 2020
- Publisher :
- Akademiai Kiado Zrt., 2020.
-
Abstract
- Are governments able to continuously boost economic growth by spending for decades? Can the state be a more efficient user of income by improving the structure of public spending? The paper analyses the correlation between various types of public expenditures and GDP growth in different countries of the EU. The database was composed from the Classification of the Functions of Government (COFOG) classification of public spending, which contains data of 25 EU economies in the period 1996–2017. Three econometric models were applied in accordance with the empirical practice found in the literature: first-differences general method of moment (GMM), fixed effects panel and ordinary least squares (OLS) models. The expenditures on social protection proved to have a negative, statistically significant and robust impact on GDP growth. The results are similar for general public spending, and while spending on public order also has a significant and robust coefficient, its sign is ambiguous. The novelty of the article relate to the findings on lagged education and health spending, which have a positive impact on GDP growth.
- Subjects :
- Government
General method
Public Administration
Sociology and Political Science
Strategy and Management
Term (time)
Econometric model
Social protection
Health spending
Industrial relations
Ordinary least squares
Public order
Economics
Econometrics
Business and International Management
General Economics, Econometrics and Finance
Subjects
Details
- ISSN :
- 1588970X and 15889726
- Volume :
- 42
- Database :
- OpenAIRE
- Journal :
- Society and Economy
- Accession number :
- edsair.doi...........664fb9cf7425aaa925d7a4dfae31ddaf
- Full Text :
- https://doi.org/10.1556/204.2020.00018