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Productive Government Expenditure And Economic Growth

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Author Info
Andreas Irmen
Johanna Kuehnel

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Abstract

We provide a comprehensive survey of the recent literature on the link between productive government expenditure and economic growth. We show that an understanding of the core results and the ensuing contributions can be gained from the study of their respective Euler equations. We argue that the existing literature incorporates many relevant aspects; however, policy recommendations tend to hinge on several knife-edge assumptions. Therefore, future research ought to focus more on idea-based endogenous growth models to check the robustness of policy recommendations. Moreover, the inclusion of hitherto unexplored types of government expenditure, e.g. on the 'rule of law', would be desirable. Copyright © 2009 Blackwell Publishing Ltd.

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Article provided by Blackwell Publishing in its journal Journal of Economic Surveys.

Volume (Year): 23 (2009)
Issue (Month): 4 (09)
Pages: 692-733
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Handle: RePEc:bla:jecsur:v:23:y:2009:i:4:p:692-733

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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Chu, Angus C. & Lai, Ching-Chong, 2009. "On the Growth and Welfare Effects of Defense R&D," MPRA Paper 16325, University Library of Munich, Germany. [Downloadable!]
  2. Kühn, Stefan & Muysken, Joan & Veen, Tom van, 2009. "The Adverse Effects of Government Spending on Private Consumption in New Keynesian Models," Research Memoranda 004, Maastricht : METEOR, Maastricht Research School of Economics of Technology and Organization. [Downloadable!]
  3. Torrisi, Gianpiero, 2009. "A multilevel analysis on the economic impact of public infrastructure and corruption on Italian regions," MPRA Paper 15487, University Library of Munich, Germany. [Downloadable!]
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