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Varieties Of Capitalism And Government Spending In Developed And Developing Countries

Author

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  • JOACHIM AHRENS

    (PFH Gottingen Private University of Applied Science, Germany)

  • RAINER SCHWEICKERT

    (Kiel Institute for the World Economy, Germany)

  • JULIANE ZENKER

    (University of Hannover, Germany)

Abstract

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.

Suggested Citation

  • Joachim Ahrens & Rainer Schweickert & Juliane Zenker, 2015. "Varieties Of Capitalism And Government Spending In Developed And Developing Countries," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 40(1), pages 113-136, March.
    • Handle: RePEc:jed:journl:v:40:y:2015:i:1:p:113-136
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    References listed on IDEAS

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    More about this item

    Keywords

    Government Size; Political Governance; Economic Systems; Inequality; Openness; Developing Regions;
    All these keywords.

    JEL classification:

    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • P10 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - General
    • P51 - Political Economy and Comparative Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

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