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Is Government Size Optimal in the Gulf Countries of the Middle East? An empirical investigation

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Author Info
Hassan Aly, Mark Strazicich

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Abstract

The size of government consumption relative to national output is examined to see if it is optimal in five Gulf countries of the Middle East. We follow the methodology suggested in Barro (1990) and Karras (1996, 1997). The 'Barro rule' is examined using regression tests for each country and in panels created by pooling data. Results find that government consumption is productive, but the size of government is larger than optimal.

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Article provided by Taylor and Francis Journals in its journal International Review of Applied Economics.

Volume (Year): 14 (2000)
Issue (Month): 4 (October)
Pages: 475-483
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Handle: RePEc:taf:irapec:v:14:y:2000:i:4:p:475-483

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  1. Guseh, James S., 1997. "Government Size and Economic Growth in Developing Countries: A Political-Economy Framework," Journal of Macroeconomics, Elsevier, vol. 19(1), pages 175-192, January. [Downloadable!] (restricted)
  2. Robert J. Barro, 1996. "Determinants of Economic Growth: A Cross-Country Empirical Study," NBER Working Papers 5698, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  3. Karras, Georgios, 1993. "Employment and Output Effects of Government Spending: Is Government Size Important?," Economic Inquiry, Oxford University Press, vol. 31(3), pages 354-69, July.
  4. Karras, Georgios, 1996. "The Optimal Government Size: Further International Evidence on the Productivity of Government Services," Economic Inquiry, Oxford University Press, vol. 34(2), pages 193-203, April.
  5. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages S103-26, October. [Downloadable!] (restricted)
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  6. Karras, Georgios, 1997. "On the Optimal Government Size in Europe: Theory and Empirical Evidence," The Manchester School of Economic & Social Studies, Blackwell Publishing, vol. 65(3), pages 280-94, June.
  7. Levine, Ross & Renelt, David, 1992. "A Sensitivity Analysis of Cross-Country Growth Regressions," American Economic Review, American Economic Association, vol. 82(4), pages 942-63, September. [Downloadable!] (restricted)
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