Abstract
It is well known that the growth in the post-war era of what became known as the welfare state, as well as the more general growth of public expenditure, in many places accompanied the rise of Keynesianism. The quantitative and qualitative terms of that relationship, however, vary significantly in advanced OECD countries, and it is this aspect of the debate which has considerable implications for the questions that have concerned the present argument.
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Notes
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The explanation for a high commitment to capital investment on the part of some countries, to which Kalecki would have been able to attest, is to be found in the political realm. Public capital investment has to be paid for. In its radical tradition social democracy is predisposed that this investment be financed through taxation upon capital. Apart from the direct beneficial effects of such taxation providing finance for public investment, there are the effects, noted above, of complementarity and of the prevention of private sector stagnation under conditions of less than full capacity. The theory of slow-down of capacity utilisation and subsequent stagnation was developed by Josef Steindl, Maturity and Stagnation in American Capitalism (Oxford: Blackwell, 1952).
EPAC, Aspects of the Social Wage: A Review of Social Expenditures and Redistribution (Canberra: Office of EPAC, 1987), pp. 13–16.
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© 1997 Tim Battin
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Battin, T. (1997). Public Expenditure and the Growth of Welfare. In: Abandoning Keynes. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-14350-4_8
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