SECTION: What is the FCP all about

LEVEL 2 SECTION: What are the policies of the FCP?

LEVEL 3 SECTION: What is the optimum?

LEVEL 4 SECTION: What Maximum Point?

YOU WERE READING:

...relationship between the size of government and economic performance...

WHAT ABOUT ECONOMIC PERFORMANCE?

The Rahn curve, shows the effect of government spending (as a percentage of GDP) on economic growth.^1,2 

As expected, the Rahn curve has a behaviour similar to what we described for the STING curve. 

 

Scholarly research indicates that most industrialized nations are on the downward sloping portion of the Rahn Curve. 

In other words, policymakers could enhance economic performance, government revenue and crucial social programs by reducing the size and scope of government.

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REFERENCES:

[1] "The Impact of Government Spending on Economic Growth", ByDaniel J.Mitchell, Ph.D.

[2] Robert J. Barro, “Economic Growth in a Cross Section of Countries,” Quarterly Journal of Economics, Vol. 106, No. 2 (May, 1991), p. 407.