Abstract
This empirical paper uses annual data for Greece 1960–2000 to study the link between fiscal policy and economic growth. Our regression analysis implies that, although a smaller public sector can be good for growth, it is necessary to look beyond size; the composition and quality/efficiency of the public sector are equally important. The policy lesson is that a smaller government share in GDP, a reallocation of funds away from the wage bill to public investment, and an improvement in government quality/efficiency can become engines of long-term growth.
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JEL Classification: E6, O5
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Angelopoulos, K., Philippopoulos, A. The growth effects of fiscal policy in Greece 1960–2000. Public Choice 131, 157–175 (2007). https://doi.org/10.1007/s11127-006-9111-3
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DOI: https://doi.org/10.1007/s11127-006-9111-3