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Optimal Size Of Government Spending. The Case Of European Union Member States

  • Mihai Mutascu

    (West University of Timisoara)

  • Marius Milos

    (Eftimie Murgu University Resita)

The theme of public expenditure has been of great interest in the latest years.Focusing on government size, role of government and the efficiency of the public sector becomes aneven more important issue nowadays when the financial crisis has covered severly almost alleconomies worlwide. The debate has as starting point the keynesian belief (state interventionovercomes recession periods) but also the division of the economy between the public and theprivate sector. Goods and services could be provided by the state, but many times the private sectorseems to be more efficient. Using a specific econometrical analysis, the authors try to establish theoptimal size of the public sector in both old and new member states of the European Union, a levelthat fosters economic growth and suggest that, following this point, GDP should be left in thehands of the private sector.

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Article provided by Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia in its journal Annales Universitatis Apulensis Series Oeconomica.

Volume (Year): 1 (2009)
Issue (Month): 11 ()
Pages: 45

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Handle: RePEc:alu:journl:v:1:y:2009:i:11:p:45
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  1. Agell, Jonas & Lindh, Thomas & Ohlsson, Henry, 1997. "Growth and the public sector: A critical review essay," European Journal of Political Economy, Elsevier, vol. 13(1), pages 33-52, February.
  2. Ulrike Mandl & Adriaan Dierx & Fabienne Ilzkovitz, 2008. "The effectiveness and efficiency of public spending," European Economy - Economic Papers 301, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.
  3. Philip Grossman, 1987. "The optimal size of government," Public Choice, Springer, vol. 53(2), pages 131-147, January.
  4. António Afonso & Ludger Schuknecht & Vito Tanzi, 2005. "Public sector efficiency: An international comparison," Public Choice, Springer, vol. 123(3), pages 321-347, June.
  5. Afonso, António & Schuknecht, Ludger & Tanzi, Vito, 2006. "Public sector efficiency: evidence for new EU member states and emerging markets," Working Paper Series 0581, European Central Bank.
  6. António Afonso & Davide Furceri, 2008. "Government Size, Composition, Volatility and Economic Growth," Working Papers Department of Economics 2008/04, ISEG - School of Economics and Management, Department of Economics, University of Lisbon.
  7. Afonso, António & St. Aubyn, Miguel, 2005. "Cross-country efficiency of secondary education provision: a semi-parametric analysis with non-discretionary inputs," Working Paper Series 0494, European Central Bank.
  8. Amartya SEN, 2000. "Work and rights," International Labour Review, International Labour Organization, vol. 139(2), pages 119-128, 06.
  9. António Afonso & Miguel St. Aubyn, 2006. "Relative Efficiency of Health Provision: a DEA Approach with Non-discretionary Inputs," Working Papers Department of Economics 2006/33, ISEG - School of Economics and Management, Department of Economics, University of Lisbon.
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