@techreport{Angelopoulos2005role,
abstract = {It is known that anti-social redistributive activities (rent seeking, tax evasion, corruption,
violation of property rights, delay of socially beneficial reforms, etc) hurt the macroeconomy.
But it is less known what is the role of government size as a determinant of such activities.
We use data from 64 counties (both developed and developing) in 5-year periods over 1980-
2000. As a measure of anti-social activities, we use the ICRG index; as a measure of
government size, we use the government share in GDP; and as a measure of government
efficiency, we construct an index by following the methodology of Afonso, Schuknecht and
Tanzi (2003). Our regressions show that what really matters to social incentives is the relation
between size and efficiency. Specifically, while a larger size of government is bad for
incentives when one ignores efficiency, the results change drastically when government
efficiency is also taken into account. Only when our measure of size exceeds our measure of
efficiency, larger public sectors are bad for incentives. By contrast, when efficiency exceeds
size, larger public sectors are not bad; actually, in the case where efficiency is measured by
government performance in the policy areas of administration, stabilization and infrastructure,
larger public sectors significantly improve incentives.},
author = {Konstantinos Angelopoulos and Apostolis Philippopoulos},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {D7; H11; H3; 330; government and behaviour of agents; collective decision-making; Staatliche Einflussnahme; Wirtschaftliche Effizienz; \"{O}konomischer Anreiz; Staatsquote; Rent Seeking; Sch\"{a}tzung; Welt},
language = {eng},
number = {1427},
title = {The role of government in anti-social redistributive activities},
type = {CESifo working papers},
url = {http://hdl.handle.net/10419/18791},
year = {2005}
}
