Federal, state, and local governments: Evaluating their separate roles in US growth

Matthew J. Higgins, Andrew T. Young, Daniel Levy

Research output: Contribution to journalArticlepeer-review

7 Scopus citations

Abstract

We use US county level data from 1970 to 1998 to explore the relationship between economic growth and government employment at three levels: federal, state and local. Increases in federal, state and local government employments are all negatively related to economic growth. We find no evidence that government is more efficient at lower levels. While we cannot separate out the productive and redistributive services of government, we document that the county-level income distribution became slightly more unequal from 1970 to 1998. We conclude that a release of government-employed labor inputs to the private sector would be growth-enhancing.

Original languageEnglish
Pages (from-to)493-507
Number of pages15
JournalPublic Choice
Volume139
Issue number3-4
DOIs
StatePublished - Jun 2009

Keywords

  • County-level data
  • Economic growth
  • Federal government
  • Local government
  • State government

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