# 99-042/3 (1999-06-08)

Martijn Brons, Vrije Universiteit Amsterdam; Henri L.F.M. de Groot, Vrije Universiteit Amsterdam; Peter Nijkamp, Vrije Universiteit Amsterdam
fiscal policy; government spending; taxation; economic growth; comparative analysis
JEL codes:
O11; O23; O47; O57

The potential interactions among fiscal policies, investments and economicgrowth are complex and manifold.In this paper, we will perform a systematic comparative analysis of the variouseconomic insights that arecurrently available on these complex relationships, both theoretically (by aselective literature review) andempirically (by investigating available data from various countries). Despitethe wide variety of potentialtheoretical relationships between government expenditures, taxation and growth,most empirical analyses arerestricted to simple linear regressions of growth on some measure of governmentexpenditures. Based onempirical experiments, we will indicate directions for future empirical researchthat may enrich our knowledgeon the complex relationship between fiscal policies and economic growth, notonly nationally but also regionally.