Economic Liberalization, the Changing Role of the State and “Wagner’s Law”: China’s Development Experience since 1978

Tobin, Damian

doi:10.1016/j.worlddev.2004.12.001

Cited by 23 publications

(14 citation statements)

References 7 publications

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“…The WH can be used as a resource for analyzing the impact of changes in the pattern of a country's development on the participation of the government in economic activity, which is argued by Tobin (2005) in the case of the Chinese economy and its more or less recent economic liberalization process. Using data for the period 1978-2001, an autoregressive model and a partial adjustment model were applied and it was found that real GDP actually has a positive effect on government spending.…”

Section: Literature Reviewmentioning

confidence: 99%

The Relationship between Total Production and Public Spending in Mexico: Keynes versus Wagner

Juárez¹,

Almada²,

Bustillos³

2015

International Journal of Financial Research

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This paper studies the relationship between public spending and production in Mexico. It aims to assess the direction of causality between these two variables ranging from economic growth to public expenditure (Wagner hypothesis) or public spending to economic growth (Keynesian hypothesis). Annual time series for the period 1925-2014 of production and public spending in real terms (1970 based) and logarithms were used. The test method involved three steps: 1) unit root tests; 2) cointegration test of Engle and Granger and 3) evidence of causality in the Granger sense. The paper uses five different specifications recommended by the specialized international literature. It was found that the series are stationary with regards first differences and are cointegrated, so we can say there is a long-term relationship. Statistical tests of Granger causality indicated that the Wagner hypothesis does not hold, while the Keynes hypothesis is validated. The study concludes that public spending and its proper management is one of the keys to promoting economic growth in Mexico. Originality/value: Time series for a long-term period, based on official information, something not done previously, were developed. This allowed the results to be more reliable than those presented by other authors. In addition, a modern procedure of econometric estimation, allowing the assessment of the two proposed scenarios was used. The work is relevant in terms of the design of economic policy and the pursuit of development in Mexico.

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Section: Literature Reviewmentioning

confidence: 99%

The Relationship between Total Production and Public Spending in Mexico: Keynes versus Wagner

Juárez¹,

Almada²,

Bustillos³

2015

International Journal of Financial Research

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“…Narayan et al (2008) use provincial data in a simple model and find weak confirmation that Wagner's Law applies in only the western region. Tobin (2005) engages in a more involved analysis of the applicability of the Law to China and finds that Chinese development exhibits the same patterns that Wagner observed in Europe in the nineteenth century. However, Tobin does not explain the mechanism behind the positive correlation between national wealth and government expenditure, nor does he explicitly treat China's distinction in having a relatively large SOE sector.…”

Section: Influence and Statistical Significance Of The Soe Presence Imentioning

confidence: 86%

The size of the SOE sector and macroeconomic performance: an empirical study based on Chinese provincial data

Huang

Ping

Lotspeich

2009

Econ Change Restruct

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“…Most of the studies in China do not favor Wagner's law. Tobin (2005) developed a simple illustrative model to measure the effects of increasing national wealth and the growth of the public sector and determined that the patterns of economic development observed by Wagner in 19th-century Europe are unlike those observed in China today. Guo and Jia (2010) found that per capita GDP and urbanization process have a significantly negative role in the scale of local governmental expenditure at the county level, which is not consistent with Wagner's law.…”

Section: Other Factors Possibly Influencing Local Government Sizementioning

confidence: 99%

Fiscal Decentralization, Budgetary Transparency, and Local Government Size in China

Zhang

2016

Emerging Markets Finance and Trade

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This article makes use of panel data for 31 provinces between 1985 and 2010 and specifies a dynamic panel model to investigate the determinants of local government size in China and achieved several conclusions: (1) the fiscal decentralization since TSS reform in 1994 has increased the local government size; (2) budgetary transparency has a U-shape nonlinear effect on local government size; (3) fiscal revenue is the important factor to drive the overexpansion of local government size in China; and (4) local government size has a strong dependence of past path.

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Economic Liberalization, the Changing Role of the State and “Wagner’s Law”: China’s Development Experience since 1978

Cited by 23 publications

References 7 publications

The Relationship between Total Production and Public Spending in Mexico: Keynes versus Wagner

The Relationship between Total Production and Public Spending in Mexico: Keynes versus Wagner

The size of the SOE sector and macroeconomic performance: an empirical study based on Chinese provincial data

Fiscal Decentralization, Budgetary Transparency, and Local Government Size in China

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