Government size, institutions, and export performance among OECD economies
Working paper
Bournakis, I., Tsoukis, C., Middlesex University and London Metropolitan University 2013. Government size, institutions, and export performance among OECD economies. Middlesex University.
Type | Working paper |
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Title | Government size, institutions, and export performance among OECD economies |
Authors | Bournakis, I., Tsoukis, C., Middlesex University and London Metropolitan University |
Abstract | We investigate the effect of the size of government, captured by the tax revenue as a share of GDP, and institutional features on countries’ export performance (export shares in international markets). Theoretically, we show in a model of endogenous extent of domestically-produced goods that there exists a well-defined government size that optimally promotes exports. Empirically, we show in a panel of 18countries for 1980-2005 that the tax-GDP ratio is significant and exerts a non-linear effect on export performance, showing that there indeed exists an optimal size of government, which we estimate at around 40%. Product market rigidities are also shown to affect negatively export performance via a negative effect on R&D. Among traditional variables, relative unit labour cost and R&D shares in GDP show up significantly and with the expected signs. |
Publisher | Middlesex University |
Publication process dates | |
Deposited | 17 Jun 2013 |
Output status | Published |
Additional information | This paper will be submitted to 45th Annual Conference of the Money, Macro and Finance Research Group |
Language | English |
File | License |
https://repository.mdx.ac.uk/item/840q6
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