Testing Wagner's law using disaggregated public expenditure data in the case of Greece: 1958-93

Abstract

The factors that have influenced the growth of public expenditures have been the subject of extensive theoretical and empirical research. The validity of Wagner's law in the case of Greece is tested using disaggregated public expenditure data for the period 1958-93. The methodology employed is that of cointegration and the related notion of error correction. Results reported here suggest that in the case of Greece only the growth of defence expenditure may be explained in terms of Wagner's law.