Government Size and Trade Openness: Some Additional Insights
This paper provides additional insights on the relationship between government size and trade openness using a panel of countries drawn from the World Development Indicators and the Penn World Tables 7.0 from 1962 to 2009. It is shown that the compensation hypothesis proposed by Rodrik (1998) and revisited by Alesina and Wacziarg (1998) and by Ram (2009) cannot be attributed general validity. Rather, it may be driven by specific geographical areas.
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- Francesca Gastaldi & Paolo Liberati, 2011. "Economic integration and government size: a review of the empirical literature," Financial Theory and Practice, Institute of Public Finance, vol. 35(3), pages 327-384.
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- Dani Rodrik, 1996. "Why Do More Open Economies Have Bigger Governments?," NBER Working Papers 5537, National Bureau of Economic Research, Inc.
- Wacziarg, Romain & Alesina, Alberto, 1998.
"Openness, Country Size and Government,"
4553014, Harvard University Department of Economics.
- Alena Kimakova, 2009. "Government size and openness revisited: the case of financial globalization," Kyklos, Wiley Blackwell, vol. 62(3), pages 394-406, 08.
- Ram, Rati, 2009. "Openness, country size, and government size: Additional evidence from a large cross-country panel," Journal of Public Economics, Elsevier, vol. 93(1-2), pages 213-218, February.
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