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Efficient government size: France in the 20th century

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  • Facchini, François
  • Melki, Mickaël

Abstract

The benefits and costs of government suggest an efficient government size. We investigate efficient government size by analyzing the relation between public spending and real GDP for France in the period 1896–2008. The results show a co-integration nonlinear relationship. Our time-series data on France represents one of the longest periods studied in literature. Our empirical findings suggest that efficient government size measured by public spending was reached when public spending was around 30% of GDP. Conclusions point to particularities of countries that suggest efficient government size is specific to different countries.

Suggested Citation

  • 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.
  • Handle: RePEc:eee:poleco:v:31:y:2013:i:c:p:1-14
    DOI: 10.1016/j.ejpoleco.2013.03.002
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    More about this item

    Keywords

    Public spending; Optimal government size; Economic growth; Nonlinear cointegration;
    All these keywords.

    JEL classification:

    • H1 - Public Economics - - Structure and Scope of Government
    • H5 - Public Economics - - National Government Expenditures and Related Policies

    Statistics

    Access and download statistics

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