The Demand for Current Public Expenditure in Fiji: Theory and Empirical Results
This paper analyses current government expenditure in Fiji using annual time series data for the period 1969-1999. Alternative theories of government expenditure are reviewed and a distinction is made between economic/apolitical determinants and institutional/political determinants. Categorising the literature in this way suggests the application of non-nested tests in empirical work, which is reported elsewhere. All non-nested tests lead to the conclusion of double rejection. Therefore, a parsimonious comprehensive model, encompassing both economic and institutional variables, is preferred as it passes all diagnostic tests and exhibits no sign of misspecification. The Engle-Granger two-step procedure has been applied to analyse both long- and short-run determinants of public expenditure. The paper presents the first empirical estimates of the own-price elasticity of demand and income elasticity of demand for current public expenditure in Fiji.
|Date of creation:||2003|
|Publication status:||Published in Pacific Economic Bulletin 1.18(2003): pp. 54-66|
|Contact details of provider:|| Postal: Ludwigstraße 33, D-80539 Munich, Germany|
Web page: https://mpra.ub.uni-muenchen.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Bergstrom, Theodore C & Goodman, Robert P, 1973. "Private Demands for Public Goods," American Economic Review, American Economic Association, vol. 63(3), pages 280-296, June.
- Borcherding, Thomas E & Deacon, Robert T, 1972. "The Demand for the Services of Non-Federal Governments," American Economic Review, American Economic Association, vol. 62(5), pages 891-901, December.
- Marlow, Michael L & Orzechowski, William, 1996. "Public Sector Unions and Public Spending," Public Choice, Springer, vol. 89(1-2), pages 1-16, October.
- Anthony Downs, 1957. "An Economic Theory of Political Action in a Democracy," Journal of Political Economy, University of Chicago Press, vol. 65, pages 135-135.
- Gemmell, Norman, 1990. "Wagner's Law, Relative Prices and the Size of the Public Sector," The Manchester School of Economic & Social Studies, University of Manchester, vol. 58(4), pages 361-377, December.
- Dennis Mueller & Peter Murrell, 1986. "Interest groups and the size of government," Public Choice, Springer, vol. 48(2), pages 125-145, January.
- Rogoff, Kenneth, 1990. "Equilibrium Political Budget Cycles," American Economic Review, American Economic Association, vol. 80(1), pages 21-36, March.
- Stigler, George J, 1970. "Director's Law of Public Income Redistribution," Journal of Law and Economics, University of Chicago Press, vol. 13(1), pages 1-10, April.
- Pesaran, M H & Deaton, Angus S, 1978. "Testing Non-Nested Nonlinear Regression Models," Econometrica, Econometric Society, vol. 46(3), pages 677-694, May.
- Valadkhani, Abbas, 2001. "An Analysis of Iran’s Third Five-Year Development Plan in the Post-Revolution Era (2000-2005)," MPRA Paper 50386, University Library of Munich, Germany.
- Engle, Robert & Granger, Clive, 2015.
"Co-integration and error correction: Representation, estimation, and testing,"
Publishing House "SINERGIA PRESS", vol. 39(3), pages 106-135.
- Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, vol. 55(2), pages 251-276, March.
- Azmat Gani, 1998. "Some empirical evidence on the determinants of immigration from Fiji to New Zealand: 1970-94," New Zealand Economic Papers, Taylor & Francis Journals, vol. 32(1), pages 57-69.
- Buchanan, James M. & Wagner, Richard E., 1978. "Dialogues concerning fiscal religion," Journal of Monetary Economics, Elsevier, vol. 4(3), pages 627-636, August.
- Wagner, Richard E & Weber, Warren E, 1975. "Competition, Monopoly, and the Organization of Government in Metropolitan Areas," Journal of Law and Economics, University of Chicago Press, vol. 18(3), pages 661-684, December.
- Pesaran, H., 1995. "Planning and Macroeconomic Stabilization in Iran," Cambridge Working Papers in Economics 9508, Faculty of Economics, University of Cambridge.
- D.P. Doessel & Abbas Valadkhani, 2002. "Public Finance and The Size of Government: A Literature Review and Econometric Results for Fiji," School of Economics and Finance Discussion Papers and Working Papers Series 108, School of Economics and Finance, Queensland University of Technology.
- Borcherding, Thomas E., 1985. "The causes of government expenditure growth: A survey of the U.S. evidence," Journal of Public Economics, Elsevier, vol. 28(3), pages 359-382, December.
- William D. Nordhaus, 1975. "The Political Business Cycle," Review of Economic Studies, Oxford University Press, vol. 42(2), pages 169-190.
- Abbas Valadkhani, 1998. "Effect of government capital expenditure on GDP in the Iranian economy using superexogeneity testing," Applied Economics Letters, Taylor & Francis Journals, vol. 5(6), pages 361-364. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:50392. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Winter)
If references are entirely missing, you can add them using this form.