The paper takes stock of the debate on the positive link between output volatility and the size of government … government size-volatility relationship largely reflects temporary developments (better monetary management and financial …

the volatility of output. However, in the model, we find that the stabilizing effect is only due to a composition effect … and it is not present when we look at the volatility of private output. Given that empirically we also observe a negative … correlation between government size and the volatility of consumption, we modify the model by introducing rule-of-thumb consumers …

volatility across fully integrated economies using Japan’s regional income accounting and public finance data. The contributions …

paper offers a solution to this disagreement, suggesting that volatility carries a positive direct effect, but also a … volatility is then ambiguous. The paper reveals the underlying endogeneity of government size in a balanced panel of 95 countries … increase of volatility lowers growth by up to 0.57 percentage points in a democracy, but raises growth by 1.74 percentage …

The paper takes stock of the debate on the positive link between output volatility and the size of government … government size-volatility relationship largely reflects temporary developments (better monetary management and financial …