Bureaucratic Choice and Endogenous Growth

Author: Ott, Ingrid

Source: FinanzArchiv: Public Finance Analysis, Volume 57, Number 2, March 2001 , pp. 225-242(18)

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Abstract:

This paper analyzes the effects on the growth rate and economic welfare if the social planner engages in selfish behavior. These effects are displayed in a model of endogenous growth with productive governmental spending. The budget maximizing social planner determines how the public input is to be financed. The integration of selfish behavior by the social planner into a dynamic context combines the endogenous growth theory with the public choice theory. It will be shown that selfish behavior by the planner does not automatically lead to a sub-optimal supply level of the public good with an ensuing welfare loss. Although maximizing his personal utility, the planner may realize an efficient provision. Rather, the consequences of selfish behavior on welfare significantly depend on the formulation of the planner's personal preferences.

Document Type: Research article

DOI: http://dx.doi.org/10.1628/0015221012905002

Publication date: 2001-03-01

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FinanzArchiv founded in 1884 is one of the world's oldest professional journals in public finance.

FinanzArchiv publishes original work from all fields of public economics which are of interest to an international readership, e.g. taxation, public debt, public goods, public choice, federalism, market failure, social policy, and the welfare state. Special emphasis is on high-quality theoretical and empirical papers on current policy issues.

FinanzArchiv is a well-established, internationally oriented journal in the field of public economics, widely read in Europe and all over the world.

FinanzArchiv is listed in the Social Science Citation Index (SSCI, JCR impact factor 2007 0,296), in Current Contents/Social and Behavioral Sciences, in IDEAS and RePEc (IDEAS/RePEc simple impact factor 2008 1.177), in the Journal of Economic Literature (CD and online), and in the International Bibliography of the Social Sciences.

FinanzArchiv is a fully peer-reviewed journal committed to a prompt turnaround of submissions. No more than four months should pass between online submission of a manuscript and the editor's decision on acceptance, revision, or rejection.
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Bureaucratic Choice and Endogenous Growth

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