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War and the growth of government

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  • O'Reilly, Colin
  • Powell, Benjamin

Abstract

This paper empirically examines how wars impact the size and scope of government using a panel of all wars from 1965 to 2010. Higgs (1987) gives us reason to believe that wars may permanently increase government size and scope while Olson (1982) describes how wars can dislodge interest groups and allow for market liberalizing reforms. We find that wars permanently expand the scope of government regulation but do not impact government size systematically across the countries we study.

Suggested Citation

  • O'Reilly, Colin & Powell, Benjamin, 2015. "War and the growth of government," European Journal of Political Economy, Elsevier, vol. 40(PA), pages 31-41.
    • Handle: RePEc:eee:poleco:v:40:y:2015:i:pa:p:31-41
    DOI: 10.1016/j.ejpoleco.2015.10.001
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    Cited by:

    1. Bjørnskov, Christian, 2016. "Economic freedom and economic crises," European Journal of Political Economy, Elsevier, vol. 45(S), pages 11-23.
    2. Andrew T. Young & Jamie Bologna, 2016. "Crises And Government: Some Empirical Evidence," Contemporary Economic Policy, Western Economic Association International, vol. 34(2), pages 234-249, April.
    3. Benjamin Powell & Matt E. Ryan, 2017. "The Global Spread of Think Tanks and Economic Freedom," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 32(Fall 2017), pages 17-31.
    4. Colin O’Reilly & Ryan H. Murphy, 2017. "Exogenous Resource Shocks and Economic Freedom," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 59(3), pages 243-260, September.
    5. Ryan H. Murphy & Colin O’Reilly, 2019. "Applying panel vector autoregression to institutions, human capital, and output," Empirical Economics, Springer, vol. 57(5), pages 1633-1652, November.
    6. Ryan H Murphy, 2020. "Does democracy die in recessions? A descriptive analysis of aggregate demand shortfalls and regime transition," Economic Affairs, Wiley Blackwell, vol. 40(1), pages 63-76, February.
    7. Krieger, Tim & Meierrieks, Daniel, 2020. "Population size and the size of government," European Journal of Political Economy, Elsevier, vol. 61(C).
    8. Raymond J. March & Conrad Lyford & Benjamin Powell, 2017. "Causes and barriers to increases in economic freedom," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 64(1), pages 87-103, March.
    9. Theresa Hager, 2020. "Special Interest Groups and Growth: A Meta-Analysis of Mancur Olsons Theory," ICAE Working Papers 116, Johannes Kepler University, Institute for Comprehensive Analysis of the Economy.
    10. Vincent Geloso & Kelly Hyde & Ilia Murtazashvili, 2022. "Pandemics, economic freedom, and institutional trade-offs," European Journal of Law and Economics, Springer, vol. 54(1), pages 37-61, August.
    11. Thoradeniya, Prabanga & Lee, Janet & Tan, Rebecca & Ferreira, Aldónio, 2022. "From intention to action on sustainability reporting: The role of individual, organisational and institutional factors during war and post-war periods," The British Accounting Review, Elsevier, vol. 54(1).
    12. Tushar Bharati & Mohammad Farhad & Michael Jetter, 2023. "On the relationship between trade openness and government size," The World Economy, Wiley Blackwell, vol. 46(7), pages 2102-2133, July.
    13. Powell, Benjamin & Clark, J.R. & Nowrasteh, Alex, 2017. "Does mass immigration destroy institutions? 1990s Israel as a natural experiment," Journal of Economic Behavior & Organization, Elsevier, vol. 141(C), pages 83-95.
    14. Colin O'Reilly, 2021. "Violent conflict and institutional change," Economics of Transition and Institutional Change, John Wiley & Sons, vol. 29(2), pages 257-317, April.
    15. Ryan H. Murphy & Taylor Leland Smith, 2018. "Aggregate demand shortfalls and economic freedom," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 31(1), pages 111-122, March.
    16. Bjørnskov, Christian, 2018. "The Hayek–Friedman hypothesis on the press: is there an association between economic freedom and press freedom?," Journal of Institutional Economics, Cambridge University Press, vol. 14(4), pages 617-638, August.

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    More about this item

    Keywords

    War; Economic freedom; Size of government; Institutional change;
    All these keywords.

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government
    • H12 - Public Economics - - Structure and Scope of Government - - - Crisis Management
    • N40 - Economic History - - Government, War, Law, International Relations, and Regulation - - - General, International, or Comparative
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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