How Public Spending Can Help You Grow : An Empirical Analysis for Developing Countries
Although many studies indicate that both the level and composition of public spending are significant for economic growth, the results in the empirical literature are still mixed. This note is based on a paper of the same title (Bayraktar and Moren...
| Main Authors: | , |
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| Format: | Brief |
| Language: | English |
| Published: |
World Bank, Washington, DC
2012
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/2011/02/13721068/public-spending-can-help-grow-empirical-analysis-developing-countries http://hdl.handle.net/10986/10107 |
| Summary: | Although many studies indicate that both
the level and composition of public spending are significant
for economic growth, the results in the empirical literature
are still mixed. This note is based on a paper of the same
title (Bayraktar and Moreno-Dodson 2010) that compares a set
of fast-growing developing countries to a mix of developing
countries with different growth patterns. Considering the
full government budget constraint, the empirical analysis
shows that public spending, especially its 'core'
components, contributes to economic growth only in countries
that are capable of using funds for productive purposes. In
addition, those countries must have an adequate economic
policy environment with macroeconomic stability, openness,
and private sector investments that are conducive to growth. |
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