Government Spending in a Simple Model of Endogeneous Growth
AbstractOne strand of endogenous-growth models assumes constant returns to a broad concept of capital. I extend these models to include tax- financed government services that affect production or utility. Growth and saving rates fall with an increase in utility-type expenditures; the two rates rise initially with productive government expenditures but subsequently decline. With an income tax, the decentralized choices of growth and saving are "too low," but if the production function is Cobb-Douglas, the optimizing government still satisfies a natural condition for productive efficiency. Empirical evidence across countries supports some of the hypotheses about government and growth.
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Bibliographic InfoPaper provided by Harvard University Department of Economics in its series Scholarly Articles with number 3451296.
Date of creation: 1990
Date of revision:
Publication status: Published in Journal of Political Economy -Chicago-
Other versions of this item:
- 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.
- Robert J. Barro, 1988. "Government Spending in a Simple Model of Endogenous Growth," NBER Working Papers 2588, National Bureau of Economic Research, Inc.
- Barro, R.J., 1988. "Government Spending In A Simple Model Of Endogenous Growth," RCER Working Papers 130, University of Rochester - Center for Economic Research (RCER).
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Blog mentionsAs found by EconAcademics.org, the blog aggregator for Economics research:
- Politique industrielle et systÃ¨me dâinnovation dans les pays en voie de dÃ©veloppement
by email@example.com (JihÃ¨ne Malek) in BS Initiative on 2014-06-03 10:42:25
by å??é? in 延宕与悬置 on 2010-03-21 19:41:00
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