Government size, government debt and globalization

Dong Hyeon Kim, Yu Bo Suen, Shu Chin Lin, Joyce Hsieh

Research output: Contribution to journalArticlepeer-review

10 Citations (Scopus)

Abstract

This article empirically investigates the effect of globalization on government size and debt. Using panel heterogeneous cointegration techniques to a panel of developing and developed countries, it finds that globalization reduces government size and debt. In terms of components of globalization, government size is found to increase with trade openness but decreases with financial, social and political globalization. On the other hand, government debt increases with financial and trade openness but decreases with social and political globalization. The evidence is robust to different estimation methods and different samples. Our data also indicate unidirectional causality running from globalization measures to government size and debt.

Original languageEnglish
Pages (from-to)2792-2803
Number of pages12
JournalApplied Economics
Volume50
Issue number25
DOIs
Publication statusPublished - 2018 May 28

Keywords

  • Government size
  • globalization
  • government debt
  • heterogeneous panels

ASJC Scopus subject areas

  • Economics and Econometrics

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