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Title: |
Endogenous Government Expenditure: A Test of
Wagner's Hypothesis for Hong Kong |
| Author: |
Ho, Yin-Ping |
| Author
Affiliation: |
Chinese U, Hong
Kong |
| Source: |
International Economic Journal, Autumn 1987, v. 1, no. 3, pp. 31-47 |
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Publication Date: |
Autumn 1987 |
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Abstract: |
In the last two decades a revival of
interest in Wagner's thesis of an endogenous public sector has led to a
series of empirical tests of its validity. In its barest essentials,
this paper attempts to find efficient estimates of income elasticities
of demand for real total government expenditure as well as for its
disaggregated functional groups as a means of verifying Wagner's
expectation for the Hong Kong economy. Our empirical estimates indicate
that Hong Kong's public finance setting is a synchronization of a
worldwide tendency of public sector expansion according to the Wagnerian
expectation. These findings lead us to raise a number of policy
questions concerning the financial sustainability of Hong Kong's budget
system over time. |
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