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La spesa pubblica in Italia: una crescita senza limiti?


  • Barbara Pistoresi


  • Alberto Rinaldi


  • Francesco Salsano



Using new historical data, this paper evaluates Wagner’s Law in Italy over the time period from 1862 to 2009. To this aim, cointegration and Granger causation are used to investigate the long run relationship between government expenditure and GDP. Moreover, DOLS method is applied to estimate consistent long run elasticity between these two variables. Our main findings are that Wagner’s Law does not hold in the long run for total government expenditure. However, we find strong support for Wagner’s Law in the shorter time span from 1862 to the end of the 19th century. Such a result seems the consequence of state - building after Italy’s political unification. The new - born Italian state made a huge effort to create nation - wide infrastructures (i.e., railways, telegraph, mail, and so on) as well as an administrative structure well - ramified throughout the country. Conversely, evidence in support of Wagner’s Law is weaker in the period following WW2. Now Wagner’s Law is not verified for total government expenditure, but only for social spending, infrastructure spending, and spending for subsidies to the economy. This seems the consequence of the expansion of income - elastic cultural and welfare expenditures that were demanded to the state.

Suggested Citation

  • Barbara Pistoresi & Alberto Rinaldi & Francesco Salsano, 2015. "La spesa pubblica in Italia: una crescita senza limiti?," Department of Economics 0059, University of Modena and Reggio E., Faculty of Economics "Marco Biagi".
  • Handle: RePEc:mod:depeco:0059

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    Cited by:

    1. Barbara Pistoresi & Francesco Salsano, 2020. "Italian Spending on Education: a Long-Term Perspective," Advances in Management and Applied Economics, SCIENPRESS Ltd, vol. 10(5), pages 1-1.
    2. Pistoresi, Barbara & Rinaldi, Alberto & Salsano, Francesco, 2017. "Government spending and its components in Italy, 1862–2009: Drivers and policy implications," Journal of Policy Modeling, Elsevier, vol. 39(6), pages 1117-1140.
    3. Barbara Pistoresi & Alberto Rinaldi & Francesco Salsano, 2015. "Government expenditure and economic development: evidence from Italy 1862-2009," Department of Economics 0065, University of Modena and Reggio E., Faculty of Economics "Marco Biagi".

    More about this item


    Wagner’s law; government expenditure; economic development; cointegration; Granger causation; DOLS; Italy;

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • H1 - Public Economics - - Structure and Scope of Government
    • H5 - Public Economics - - National Government Expenditures and Related Policies
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • N43 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: Pre-1913
    • N44 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: 1913-


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