Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/212006 
Authors: 
Year of Publication: 
2005
Series/Report no.: 
Bank of Finland Research Discussion Papers No. 8/2005
Publisher: 
Bank of Finland, Helsinki
Abstract: 
This paper provides some further tests for the proposition that a larger public sector leads to smaller output volatility. Both Gali and Fatas & Mihov have provided some evidence which appears to support this proposition. Their evidence is, however, based on a relatively small sample of countries. In this study, we go beyond the OECD sample and focus on a much larger World Bank data set covering up to 208 countries for the period 1960-2002.We also seek to utilise some time series aspects of the material by using pooled cross-section time series data. Tests with different models and measures clearly indicate that the original results are not very robust and the relationship between government size and output volatility is either nonexistent or very weak at best.
Subjects: 
government
fiscal policy
automatic stabilisers
JEL: 
E62
H30
E32
Persistent Identifier of the first edition: 
ISBN: 
952-462-205-X
Document Type: 
Working Paper

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