By Johan A Lybeck; Magnus Henrekson
The purpose of this ebook is to give an explanation for the post-war progress of the general public quarter in a few constructed economies. the aim is to work out no matter if scientists acquainted with their respective international locations' institutional, political and financial framework, yet nonetheless operating as a gaggle, can increase a few universal elements at the back of the expansion of presidency
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Additional resources for Explaining the growth of government
But we need still more institutional work. Following the lead of Cu sack and Renaud-van Winden, one could better integrate the micro theory of decision-making into the macro explanations. A second route suggested by Frey's paper would be to take better account of the international interdependences in modelling several countries simultaneously. A third possible way could be to engage in empirical tests of the differences be tween countries and time periods separated by differences in constitutional systems.
Hence satisfying each individual group demand does not cost very much, each group being a free rider in its own cause (Olson (1965)). g. Becker (1983). Two of the papers in this volume, namely those of Renaud and van Winden (the Netherlands) and of Brosio and Marchese (Italy), take the model further. Comparing Government Growth Rates 33 In testing this theory one would of course use such variables as the strength of labour unions, the number and strength of other organizations etc. One specific variable, which has been proposed by Cameron (1978), is the openness of the economy.
The only exception to this was Iceland, for which ßo = 0 could not be accepted but for which, nevertheless, "surprises" did not play a significant role. By way of contrast for none of the ten countries for which ß0 = 0 was not rejected, did "surprises" in GDP significantly affect changes in government expenditure. 4. Conclusions As noted earlier in this paper, the growth of government among the indus trialized nations of the world has prompted economists to seek explana tions for movements in government expenditures and revenues.