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La relación a largo plazo entre crecimiento económico y gasto público en España (1850-2000)

Author

Listed:
  • Daniel Díaz-Fuentes

    (Universidad de Cantabria)

  • Julio Revuelta

    (Universidad de Cantabria)

Abstract

This article looks at the relationship between public expenditure and economic growth in the Spanish economy in the period 1850-2000. We start from 2 assumptions: one states that the changes in public expenditure directly affect economic growth; the other reverses the relationship between these variables, by assuming that growth increases the size of the public sector. These assumptions could be identified with those proposed by Keynes and Wagner, respectively. To perform the study we applied quantitative techniques based on co-integration, causality, and error correction model. We have also taken into account the different functional components of public expenditure and structural breaks, or changes that have occurred in the series. The results show that the economic growth unidirectionally determined the fiscal policy for most of the period analysed. At least until the increase in the public sector size, driven by democratic reforms, caused a change in the causality direction of this relationship. KEY Classification-JEL: E62, H50, N43, N44

Suggested Citation

  • Daniel Díaz-Fuentes & Julio Revuelta, 2013. "La relación a largo plazo entre crecimiento económico y gasto público en España (1850-2000)," Investigaciones de Historia Económica - Economic History Research (IHE-EHR), Journal of the Spanish Economic History Association, Asociación Española de Historia Económica, vol. 9(01), pages 32-42.
    • Handle: RePEc:ahe:invest:v:09:y:2013:i:01:p:32-42
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    More about this item

    Keywords

    Economic growth; Public expenditure; Keynesian hypothesis; Wagner's Law;
    All these keywords.

    JEL classification:

    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General
    • N43 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: Pre-1913
    • N44 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: 1913-

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