Public expenditures and growth

The article explores the effects of public expenditures on growth among 73 countries over the 1970-89 period. While much of the literature attributes weak growth to public investment and social expenditures which inhibit growth through crowding-out and rent-seeking, the article highlights the contributions that public investment and social expenditures may make to growth. The article's econometric analysis suggests that crowding-out and rent-seeking concerns may have been overstated in the literature.