Optimal government size in Czech Republic and Slovakia

  • Matej Boór University of Economics in Bratislava
Keywords: government size, optimal government size, government expenditure, economic growth, BARS curve

Abstract

The government size represents a certain degree of redistribution of the resources in the economy, and there are several possibilities for its quantification. The role of government and public sector is changing over time and every measurement of government size is based on a different role. The most widely used approach to quantify government size is approach based on share of public expenditure on GDP, which we are also deeply concerned within the article. This article is mainly focused on the relationship between government size and economic growth based on BARS curve, which express non-linear relationship within these two variables. Optimal government size represents the level of government size, which will ensure the highest economic growth. On the representative sample we estimated the optimal government size in EU countries in comparison with actual government size in Czech Republic and Slovakia for the time period 1995-2017. The results show, that optimal government size in EU countries is on the level of 51,11% GDP and the government size in Czech Republic exceed this level only in the 1995 (52,9% GDP) and in Slovakia only in the 1996 (53,11% GDP) and 2000 (52% GDP).

Published
2019-04-30
How to Cite
Boór, M. (2019). Optimal government size in Czech Republic and Slovakia. Journal of Modern Economic Research, 1(1), 5-22. Retrieved from https://www.denakyrpublishing.science/index.php/jmer/article/view/3
Section
Articles