EuroEconomica, Vol 20, No 1 (2008)

Abstract

The size of government expenditures and its effect on long-run economic growth, and vice versa, has been an issue of sustained interest for decades. Many studies have analyzed how government expenditures contribute to economic growth. However, they focused on the impact of total government expenditures and overall GDP growth. Very few studies attempted to link different types of government spending to growth, and even fewer attempted to analyze the impact of government spending at the sector level.