scholarly journals Interrelation of Economic Growth and Levels of Public Expenditure in the Context of Wagner’s Law

2018 ◽  
Vol 0 (6) ◽  
pp. 174-183
Author(s):  
Mstislav P. Afanasiev ◽  
◽  
Natalia N. Shash ◽  
Keyword(s):  
Economic Growth ◽  
Public Expenditure ◽  
Wagner’S Law ◽  
Wagner's Law

scholarly journals Wagner's Law in Sri Lanka: An Econometric Analysis

2012 ◽  
Vol 2012 ◽  
pp. 1-8 ◽  
Author(s):  
Mayandy Kesavarajah
Keyword(s):  
Economic Growth ◽  
Sri Lanka ◽  
Empirical Evidence ◽  
Public Expenditure ◽  
Special Focus ◽  
Annual Data ◽  
Sri Lankan ◽  
Wagner’S Law ◽  
Long Run ◽  
Wagner's Law

This study examines whether there is empirical evidence that Wagner's law holds in the Sri Lankan economy using time series annual data over the period from 1960 to 2010 for Sri Lanka, applying cointegration and error correction modeling (ECM) techniques. In particular, this study keeps a special focus to examine the validity of six versions of Wagner's hypothesis, which support the existence of long-run relationship between public expenditure and economic growth. The empirical evidence of this study indicates that while there prevail is a short-run relationship between public expenditure and economic growth, the long-run results showed no strong evidence in support of the validity of the Wagner’s law for Sri Lankan economy. Granger causality analysis also confirms this result. Therefore, the findings of this study pave to broaden this study further for a deeper understanding about the relationship between public expenditure and economic growth by giving more attention on individual items of public expenditure and by including more macroeconomic variables in the econometric model using different methodology in future.

scholarly journals Re-Examining the Wagner’s Law versus Keynesian Hypothesis: Evidence from Nigeria

2015 ◽  
Vol 57 ◽  
pp. 142-146 ◽  
Author(s):  
O. Owolabi-Merus
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Public Expenditure ◽  
Capital Expenditure ◽  
Statistical Significance ◽  
Government Expenditure ◽  
Mutual Correlation ◽  
Wagner’S Law ◽  
Johansen Cointegration ◽  
Wagner's Law

This study investigates the Keynesian and Wagnerian views on public expenditure and economic growth in Nigeria using annual secondary data spanning from 1980 to 2011 obtained from the Central bank of Nigeria (CBN) statistical bulletins. The Augmented Dickey-Fuller (ADF), Johansen Cointegration and Granger Causality econometric methodologies were used in this study. The Johansen Cointegration test revealed the presence of a long-run cointegrated relationship between government expenditure (capital expenditure and recurrent expenditure) and economic growth (GDP) in Nigeria. The Granger Causality test found no mutual correlation between government expenditure (capital expenditure and recurrent expenditure) and economic growth (GDP) using the benchmark of 5% level of statistical significance. The findings of this study therefore indicate the non-existence of both Wagner’s Law and Keynesian Hypothesis on public expenditure and economic growth in Nigeria during the period under review.

Wagner's law and public expenditure growth in Kuwait

OPEC Review ◽  
1999 ◽  
Vol 23 (2) ◽  
pp. 139-171 ◽  
Author(s):  
Nadeem A. Burney ◽  
Nadia Al-Mussallam
Keyword(s):  
Public Expenditure ◽  
Wagner’S Law ◽  
Expenditure Growth ◽  
Wagner's Law

Economic Growth of West African Countries and the Validity of Wagner’s Law: A Panel Analysis

2016 ◽  
Vol 3 (1) ◽  
pp. 71-83 ◽  
Author(s):  
Udo Aniefiok Benedict ◽  
◽  
Effiong Charles Efefiom ◽  
Ogar Ohiama Ochagu ◽  
◽  
...  
Keyword(s):  
Economic Growth ◽  
West African ◽  
Panel Analysis ◽  
African Countries ◽  
Wagner’S Law ◽  
Wagner's Law

scholarly journals Examining the Validity of Wagner’s Law versus Keynesian Hypothesis: Evidence from Turkey’s Economy

2019 ◽  
Vol 66 (1) ◽  
pp. 117-130 ◽  
Author(s):  
Özcan Karahan ◽  
Olcay Çolak
Keyword(s):  
Economic Growth ◽  
Public Expenditures ◽  
Economic Policies ◽  
Wagner’S Law ◽  
Distributed Lag ◽  
Autoregressive Distributed Lag ◽  
Short Run ◽  
National Output ◽  
Causality Relationship ◽  
Wagner's Law

Abstract The direction of the causality relationship between public expenditures and economic growth is one of the most controversial issues of the literature, which also causes great disagreements in the design process of economic policies. There are two approaches to this subject, which are opposite each other and called “Wagner’s Law” and “Keynesian Hypothesis”. This paper aims to examine the validity of Wagner’s law and Keynesian proposition in Turkey using Autoregressive Distributed Lag (ARDL) model over the period of 1998-2016. The findings supported the “Keynesian Hypothesis”, which advocates a one-way causality relationship from public spending to national output. More specifically, the results of the study showed that the effect of public expenditures on economic growth was positive in the short term and negative in the long term. From an economic policy standpoint, it can be argued that policymakers can promote Turkish economic growth through expansionary fiscal policies in the short run.

scholarly journals THE RELATIONSHIP BETWEEN ECONOMIC GROWTH AND GOVERNMENT SPENDING: A CASE STUDY OF OIC COUNTRIES

2015 ◽  
Vol 11 (2) ◽  
pp. 149 ◽  
Author(s):  
Heri Sudarsono
Keyword(s):  
Economic Growth ◽  
Government Spending ◽  
Time Series Data ◽  
Series Data ◽  
Causality Test ◽  
Wagner’S Law ◽  
The Public ◽  
Wagner's Law ◽  
The Relationship

This paper presents the results for testing for causal relationship between economic growth and goverment spending for OIC countries covering the time series data 1970~2006. There are usually two propositions regarding the relation between economic growth and government spending: Wagner’s Law states that as GDP grows, the public sector tends to grow; and the Keynesian framework postulates that public expenditure causes GDP to grow. The primary strength and originality of this paper is that we used aggregate data as well as disaggregate data for Granger causality test. By testing for causality between economic growth and government spending, we find that government spending does cause economic growth in Iran, Nigeria and Tunisia, which are compatible with Keynesian’s theory. However, the economic growth does cause the increase in goverment spending in Algeria, Burkina Faso, Benin, Indonesia, Libya Malaysia, Marocco, and Saudi, which are well-suited with Wagner’s law.

scholarly journals Is Wagner’s Law Applicable for Fast Growing Economies? Brics and Matik Countries

2016 ◽  
Vol 9 (1) ◽  
pp. 1-15 ◽  
Author(s):  
Bilal Kargi
Keyword(s):  
Economic Growth ◽  
Developing Countries ◽  
Public Sector ◽  
Developing Country ◽  
Unique Contribution ◽  
Causality Test ◽  
Wagner’S Law ◽  
Country Group ◽  
Causality Relationship ◽  
Wagner's Law

Abstract This study investigates the causality relationship between public sector spending and economic growth. Although a relationship between these two variables is traditionally accepted, the direction of this causality relationship has widely been discussed. The relationship in which the increase of public sector spending moves together with the growth is called as Wagner’s Law and it is examined through developing countries’ data. As being developing country group, there is a huge literature about “BRICS countries”. The unique contribution of this study is that it defines a new developing country group as “MATIK countries” and it analyzes BRICS and MATIK (BM) countries together. Therefore, the validity of Wagner’s Law is tested on economic growth and public spending figures of these country groups which have significant population and economic size in world economy. As a result of Granger Causality Test for the period of 1961-2013, findings are obtained as Wagner’s Law is not valid for majority of BM countries, which include 10 high growing economies. This conclusion is compared with other studies, which are conducted for developing countries.

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