«Public Administration Issues» Journal,

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National Research University
Higher School of Economics
20 Myasnitskaya Str., Moscow 101000, Russian Federation
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Major Indexing

Research and educational journal
Published quarterly since 2007
ISSN 1999-5431
E-ISSN 2409-5095

Mstislav Afanasyev1,2, Natalia Shash 3
  • 1 National Research University Higher School of Economics, 20 Myasnitskaya Str., Moscow, 101000, Russian Federation
  • 2 Doctor of Economics, Professor of the Department “Public and Municipal Management”, National Research University Higher School of Economics
  • 3 Doctor of Economics, Professor of Financial Management, Financial Management Department, Plekhanov Russian University of Economics, 36 Stremyanny Lane, 117997 Moscow, Russian Federation.

Interrelation of Economic Growth and Levels of Public Expenditure in the Context of Wagner’s Law

2018. No. 6. P. 174–183 [issue contents]
The paper looks into how the law formulated by A. Wagner can be used to stimulate economic growth in a post-crisis period. The major principles of the concept of fiscal economy are given. It is mainly focused on identifying regularities in perpetually growing state spending, which can be explained by increasing the fiscal needs of the state. On the basis of data from 1960 to 2015, this regularity is confi rmed for the G7 countries and Russia. It is shown that state spending goes up mostly due to growing pension payments. The authors present the results of Wagner’s Law testing obtained by researchers based on the analysis of data on both developed and developing countries. It has been discovered that it is impossible to conclude categorically about a positive effect of fiscal stimulation on economic growth. The main factors which affect the efficiency of the applied fi scal measures are described. Russia is given as an example, where the growth of state spending due to an increase in fiscal needs has not made it possible to ensure the necessary economic growth rate due to its low efficiency. The authors have found out that the main cause of the continually growing budget spending is a large share of the state presence in the Russian economy. This slows down the process of its recovery growth, which does not allow for realizing the existing potential. It has been concluded that state spending efficiency must be improved, among other things, due to a structural transformation of state spending in the budgeting system of the RF.

Citation: Afanasiev, M.P. & Shash, N.N. (2018). Interrelation of Economic Growth and Levels of Public Expenditure in the Context of Wagner’s Law. Public Administration Issue, Special Issue II (electronic edition), pp. 174–183 (in English).
ISSN 1999-5431
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