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Public spending and growth: the role of government accountability

Morozumi, Atsuyoshi; Viega, Francisco José

Authors

Francisco José Viega



Abstract

This paper examines the role of institutions in the nexus between public spending and economic growth. Empirical results based on a newly assembled dataset of 80 countries over the 1970-2010 period suggest that particularly when institutions prompt governments to be accountable to the general citizen does public capital spending promote growth. Taking account of the type of financing for this spending, we show that the growth promoting effect under an accountable government appears to prevail for various financing sources, including a reallocation from current spending, an increase in revenue, and a rise in the budget deficit. However, government accountability does not seem to play a key role in the growth effects of current spending.

Journal Article Type Article
Journal European Economic Review
Print ISSN 0014-2921
Electronic ISSN 0014-2921
Publisher Elsevier
Peer Reviewed Peer Reviewed
Volume 89
APA6 Citation Morozumi, A., & Viega, F. J. (in press). Public spending and growth: the role of government accountability. European Economic Review, 89, https://doi.org/10.1016/j.euroecorev.2016.07.001
DOI https://doi.org/10.1016/j.euroecorev.2016.07.001
Keywords Public spending; Economic growth; Institutions; Government accountability; Financing method
Publisher URL http://www.sciencedirect.com/science/article/pii/S0014292116301192
Copyright Statement Copyright information regarding this work can be found at the following address: http://creativecommons.org/licenses/by-nd/4.0

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Copyright Statement
Copyright information regarding this work can be found at the following address: http://creativecommons.org/licenses/by-nd/4.0





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