IDEAS home Printed from https://ideas.repec.org/a/cuf/journl/y2006v7i1p145-156.html

Elasticity of Substitution, Capital Inflow and Government Size

Author

Listed:
  • Sajid Anwar

    (University of Adelaide)

Abstract

A number of recent studies have attempted to identify the determinants of government size. It is well known that the size of government has implications for welfare and economic growth. This paper shows that the size of the fixed cost involving public good provision affects the magnitude of capital inflow induced changes in government size and welfare. By making use of a simulation exercise, it is argued that capital inflow can decrease (increase) the size of government and welfare if the elasticity of substitution is sufficiently large (small).

Suggested Citation

  • Sajid Anwar, 2006. "Elasticity of Substitution, Capital Inflow and Government Size," Annals of Economics and Finance, Society for AEF, vol. 7(1), pages 145-156, May.
    • Handle: RePEc:cuf:journl:y:2006:v:7:i:1:p:145-156
    as

    Download full text from publisher

    File URL: http://aeconf.com/Articles/May2006/aef070107.pdf
    Download Restriction: no
    File URL: http://down.aefweb.net/AefArticles/aef070107.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Jagdish Bhagwati & Arvind Panagariya & T. N. Srinivasan, 1998. "Lectures on International Trade, 2nd Edition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262522470, December.
    2. Dar, Atul A. & AmirKhalkhali, Sal, 2002. "Government size, factor accumulation, and economic growth: evidence from OECD countries," Journal of Policy Modeling, Elsevier, vol. 24(7-8), pages 679-692, November.
    3. Anwar, Sajid, 2005. "Specialisation-based external economies, supply of primary factors and government size," Journal of Economics and Business, Elsevier, vol. 57(3), pages 259-271.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Camilo Alvis & Cristian Castrill�n, 2013. "Tamano óptimo del gasto público colombiano: una aproximación desde la teoría del crecimiento endógeno," Revista Cuadernos de Economia, Universidad Nacional de Colombia, FCE, CID.
    2. Amal MATALLAH & Amal MATALLAH, 2017. "Does fiscal policy spur economic growth? Empirical evidence from Algeria," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(3(612), A), pages 125-146, Autumn.
    3. James Lake & Maia Linask, 2015. "Costly distribution and the non-equivalence of tariffs and quotas," Public Choice, Springer, vol. 165(3), pages 211-238, December.
    4. Boggio, Luciano, 2009. "Long-run effects of low-wage countries' growing competitiveness and exports of manufactures," Structural Change and Economic Dynamics, Elsevier, vol. 20(1), pages 38-49, March.
    5. Antonio Afonso & H seyin Sen & Ayse Kaya, 2021. "Government Size, Unemployment and Inflation Nexus in Eight Large Emerging Market Economies," Hacienda Pública Española / Review of Public Economics, IEF, vol. 235(1), pages 133-170, March.
    6. Timon Bohn & Steven Brakman & Erik Dietzenbacher, 2018. "The role of services in globalisation," The World Economy, Wiley Blackwell, vol. 41(10), pages 2732-2749, October.
    7. Shin-Chyang Lee & Shang-Fen Wu & Cheng-Te Lee, 2017. "Government Size and Stochastic Growth," Australian Economic Papers, Wiley Blackwell, vol. 56(3), pages 219-227, September.
    8. Sabrina Auci & Laura Castellucci & Manuela Coromaldi, 2021. "How does public spending affect technical efficiency? Some evidence from 15 European countries," Bulletin of Economic Research, Wiley Blackwell, vol. 73(1), pages 108-130, January.
    9. ZAREEN, SHUMAILA & Qayyum, Abdul, 2014. "An Analysis of the Impact of Government Size on Economic Growth of Pakistan: An Endogenous Growth," MPRA Paper 85426, University Library of Munich, Germany, revised 2015.
    10. Robert Maseland & Albert de Vaal, 2005. "On Trade and Poverty-Induced Comparative Advantage," DEGIT Conference Papers c010_026, DEGIT, Dynamics, Economic Growth, and International Trade.
    11. Ehsan Rajabi & Junaina Muhammad, 2014. "Does The Government Size Cause Economic Growth? Empirical Evidence from Selected ASEAN Countries," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 1, pages 3-20.
    12. Ronald Djeunankan & Joseph Pasky Ngameni & Honoré Tekam Oumbe & Nelson Diffo Lontsi, 2025. "Is government spending a barrier to industrialisation? Evidence from Africa," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 161(2), pages 785-820, May.
    13. Kayode Ayinde & John Kuranga & Adewale F. Lukman, 2015. "Modeling Nigerian Government Expenditure, Revenue and Economic Growth: Co-Integration, Error Correction Mechanism and Combined Estimators Analysis Approach," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 5(6), pages 858-867, June.
    14. Haufler, Andreas & Pflüger, Michael, 2003. "Market structure and the taxation of international trade," Discussion Papers in Economics 106, University of Munich, Department of Economics.
    15. Suleyman Kasal, 2023. "Analysing The Armey Curve Based On The Fourier Cointegration Approach For Turkey," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 68(236), pages 139-158, January –.
    16. Selçuk Çağrı ESENER & Evren İPEK, 2018. "The Impacts of Public Expenditure, Government Stability and Corruption on Per Capita Growth: An Empirical Investigation on Developing Countries," Sosyoekonomi Journal, Sosyoekonomi Society, issue 26(36).
    17. P. Sai-wing Ho, 2004. "Myrdal’s Backwash and Spread Effects in Classical Economics: Implications for Multilateral Trade Negotiations," Journal of Economic Issues, Taylor & Francis Journals, vol. 38(2), pages 537-544, June.
    18. Davies, Ronald B. & Shea, Paul, 2010. "Adaptive learning with a unit root: An application to the current account," Journal of Economic Dynamics and Control, Elsevier, vol. 34(2), pages 179-190, February.
    19. Togbenu, Fo-Kossi Edem, 2018. "Causalité entre dépenses publiques et croissance économique au Togo [Causality between Public Expenditures and Economic Growth in Togo]," MPRA Paper 87005, University Library of Munich, Germany.
    20. Facchini, François & Melki, Mickaël, 2013. "Efficient government size: France in the 20th century," European Journal of Political Economy, Elsevier, vol. 31(C), pages 1-14.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    JEL classification:

    • F20 - International Economics - - International Factor Movements and International Business - - - General
    • H19 - Public Economics - - Structure and Scope of Government - - - Other
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cuf:journl:y:2006:v:7:i:1:p:145-156. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Qiang Gao (email available below). General contact details of provider: https://edirc.repec.org/data/emcufcn.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.