Public expenditure and economic growth: further evidence for the European Union

Abstract

This paper empirically investigates the short- and long-term impact of public expenditure on economic growth. We use annual data from 28 European Union (EU) countries for the 1995–2022 period and estimate a growth model augmented for public expenditure employing the Autoregressive Distributed Lag (ARDL) panel data approach. Our results support the view that different categories of public expenditures have dissimilar long- and short-term effects on the economic performance of EU countries.