VARIETIES OF CAPITALISM AND GOVERNMENT SPENDING IN DEVELOPED AND DEVELOPING COUNTRIES

Empirical papers on the size of government suffer from neglecting preferences for government activity as discussed in the literature on varieties of capitalism. Cross-country evidence for a sample of 126 developed and developing countries reveals a global divide. Among developing countries, Asian co...

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Bibliographic Details
Published in:Journal of economic development 2015, 40(1), , pp.113-136
Main Authors: Ahrens, Joachim, Schweickert, Rainer, Zenker, Juliane
Format: Article
Language:English
Subjects:
Capitalism
Developing countries
Economic structure
Government spending
Hypotheses
Income redistribution
Interest groups
International
LDCs
Macroeconomics
Market economies
Politics
Preferences
Studies
Transition economies
경제학
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Summary:Empirical papers on the size of government suffer from neglecting preferences for government activity as discussed in the literature on varieties of capitalism. Cross-country evidence for a sample of 126 developed and developing countries reveals a global divide. Among developing countries, Asian countries are closer to continental European economies, i.e., they reveal relatively higher levels of spending dependent on the quality of governance. Latin American countries rather tend towards low-spending anglo-saxon economies and spend to stabilize rather than to fight inequality. Considering these preferences, we do not find evidence that open countries spend more in order to buffer macroeconomic risks.
ISSN:0254-8372
DOI:10.35866/caujed.2015.40.1.005