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Public Spending and Inclusive Growth in Developing Asiaâ€

Author

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  • Benedict Clements
  • Sanjeev Gupta
  • João Tovar Jalles

Abstract

This paper examines the impact of government spending on inclusive growth in developing Asia, focusing on fiscal redistribution through education, health, and social benefits. Using panel data from 16 countries over the period 1970–2017, we apply a fixed-effects logistic regression model to assess the likelihood of inclusive growth episodes. Our findings indicate that fiscal redistribution, particularly through targeted health and education spending, significantly enhances the chances of achieving inclusive growth. The results also suggest that redistributive spending helps reduce income inequality, ensuring that the benefits of economic growth are more widely shared. We further explore the practical implications of these findings through case studies of China, India, and Vietnam, demonstrating how effective government spending can foster inclusive growth. The paper highlights the importance of well-targeted fiscal policies to support sustainable and equitable development in the post-COVID recovery.

Suggested Citation

  • Benedict Clements & Sanjeev Gupta & João Tovar Jalles, 2025. "Public Spending and Inclusive Growth in Developing Asiaâ€," Public Finance Review, , vol. 53(2), pages 139-168, March.
    • Handle: RePEc:sae:pubfin:v:53:y:2025:i:2:p:139-168
    DOI: 10.1177/10911421241296203
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    References listed on IDEAS

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    1. World Bank, "undated". "World Bank East Asia and Pacific Economic Update, October 2021," World Bank Publications - Reports 36295, The World Bank Group.
    2. World Bank, "undated". "World Bank East Asia and Pacific Economic Update, April 2021," World Bank Publications - Reports 35272, The World Bank Group.
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    Cited by:

    1. Gazi Salah Uddin & Anh H. Le & Naoki Yago & John Beirne & Donghyun PARK, 2026. "Global Fragmentation, Fiscal Policy, and Economic Growth: A Cross-country Analysis," Working Papers wp62, South East Asian Central Banks (SEACEN) Research and Training Centre, revised Feb 2026.

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