A Note on the Public Choice Approach to the Growth in Government Expenditure. Public Finance Quarterly

International Monetary Fund This article applies an empirical model, based on the economic theory of public choice, to the Group of Seven countries. It is discovered: (1) that deficit financing does appear to contribute to increased real government spending; (2) that the demand for government services as a whole does not appear to be income elastic; (3) that there is some evidence of a productivity lag in the government sectors o