Government spending composition, aggregate demand, growth, and distribution

Government Spending and Growth

Composition of Government Spending, Optimal Fiscal Policy, and Endogenous Growth in the Economy of Iran

This paper investigates the optimal fiscal policy, pertaining to government spending, considering different productivity of public services in production function and its impact on the optimal tax rate, the optimal rate of government spending, and optimal economic growth rate. Using the VECM model for Iranian economy over 48 years, results show while the current expenditure has a positive and s...

Government Spending Composition in a Simple Model of Schumpeterian Growth

This paper investigates the relevance of government purchasing behavior for innovationbased economic growth. We construct a parsimonious Schumpeterian growth model in which demand from the public sphere can effectively alter the economy’s rate of technological change. We incorporate results of various empirical studies arguing that public sector demand acts as incentive for private innovation a...

Productive government spending, growth, and sequential voting

This paper considers an endogenous growth model with productive government spending in which overlapping generations of agents vote sequentially on policy. With sequential majority voting, there is a multiplicity of politico-economic equilibria originating from self-fulfilling policy expectations. Some of these equilibria are Pareto-inefficient and there are endogenous cycles. A constitutional ...

Growth and Local Government Spending in Georgia

This brief is a technical analysis that estimates the effect of local government spending on economic growth at the county level in Georgia. Recent studies in the growth and economic development literature have emphasized the impact of government spending on growth at the national and state levels, but few of these studies have attempted to identify growth–enhancing government expenditures at t...