TOTAL INCOMES IN THE UNITED STATES, 1946–1976: A SUMMARY REPORT

Extended accounts of total income and product and associated capital stocks for the United States, in current and constant dollars, are offered for the years 1946 to 1976. They include intangible and tangible capital accumulation and non-market and market outputs in all sectors, services of government and household capital and of unpaid household labor, and opportunity costs of students. Defense and police services are classified as intermediate product; a portion of commercial media services is counted as final product. Expenses related to work are subtracted while the values of employee training and human capital formation and net revaluations of existing tangible capital are added.
Total incomes (TISA) net national product was 50 percent greater than official Bureau of Economic Analysis (BEA) NNP in 1976. BEA gross private domestic investment was only about 18 percent of TISA gross capital accumulation. Intangible investment and TISA net domestic capital accumulation grew more rapidly than BEA net private domestic investment. Household investment has been growing while there have been sharp declines in government investment, particularly in research and development. Contrary to some views of the import of the narrower BEA accounts, total capital accumulation appears to have risen considerably more rapidly than total consumption, 6.3 percent versus 2.2 percent per annum from 1946 to 1976, thus increasing sharply its share of TISA GNP.     

The effects on agriculture in the United States of an oil import fee

This paper focuses on the effect that a crude oil import fee would have on the various producing sectors, consuming sectors and household categories in the United States where the interrelationships between these entities is explicitly considered. Special attention is given to the agricultural sectors of the economy. Thus, in the context of a general equilibrium model, the effect of a $5.00 per barrel import fee on the producing sectors in general and the three agricultural sectors plus forestry in particular, on the consuming sectors, on households and on the government is calculated. Over the period 1984–90 with such an import fee (relative to the absence of a crude–oil import fee), the model results suggest that there will be a reduction in output by all producing sectors (except the crude-oil industry) by about $13,924 billion, there will be a fall in the consumption of goods and services by about $318 million and there will be a decline in aggregate social welfare (measured as utility) by about $208 mill ion. The government will realize an increase in revenue of about $3,622 billion. The agricultural sectors in the aggregate can expect to see a fall in output of $769 million with an attendant increase in the price of its goods as a consequence of the oil import fee.     

The impact of fiscal consolidations on the functional components of government expenditures

This paper analyses how the functional components and sub-components of government expenditures are affected by fiscal consolidations. A fixed-effects estimator is employed over a panel of 15 European Union countries during the period 1990–2012. The results show that spending on public services increases during fiscal consolidations, while spending on defence, public order, health, education and social protection is significantly cut. A more disaggregated analysis proves that fiscal consolidations are harmful for important social expenditures, in particular, for those related to citizens’ safety, health assistance, social protection and investment in human capital. This evidence is even stronger in a particular group of countries, known in the literature as PIIGS. Hence, fiscal consolidations can have important implications on the living standards of the more economically vulnerable citizens.     

Public Investment and Economic Growth in Latin America: an Empirical Test

The paper analyzes the impact on economic growth of public investment spending and other relevant variables (such as human capital) for nine major Latin American nations over the 1983–93 period. The results suggest that both public and private investment spending contribute to economic growth. Overall central government consumption expenditures, on the other hand, are found to have a negative effect on private investment and growth. Finally, public expenditures on education and healthcare are found to have a positive and statistically significant effect on private capital formation and long–term economic growth. From a policy standpoint, the results suggest that indiscriminate cuts in public and private investment spending are likely to be counterproductive in the long run, and more importantly, scarce public expenditures should be channeled to the promotion of new human capital (via primary and secondary education) and the maintenance of existing human capital (through healthcare expenditures).     

Effects of government expenditure on private investment: Canadian empirical evidence

The purpose of this study is to investigate the relationship between government expenditures and private investment in Canada during the period 1961 to 2000. To this end, effects of five categories of government expenditures on investment are examined within the cointegration and error-correction framework. The empirical results show that government expenditure on education and health has positive effects whereas government expenditures on capital and infrastructure have negative effects on private investment. The other expenditure categories, including government expenditure on protection of persons and property, expenditure on debt charges, and expenditure on government and social services have no significant effects on private investment.I wish to thank Baldev Raj for his valuable comments on this study which have led to an important improvement in the paper. I would also like to thank my colleagues Tomson Ogwang, Paul Bowles, Jalil Safaei, and an anonymous referee for their comments. However, the usual disclaimer applies.First version Received: May 2002/Final version received:20 May 2004     

Finance and politics: the wealth effects of special interest group influence during the nationalisation and privatisation of Conrail

Conrail, nationalised in 1976 and privatised in 1987, was themost significant nationalisation and privatisation by the USgovernment in recent years. It was created from six bankruptrailroads under the pressure of interest groups, formed by customers,existing claimants, employees and related companies. We documentthe gains and losses to these special interest groups at keypoints in the nationalised and privatised time periods. Overthis period, the US government had outlays of $6.59 billion,and cash inflow of $6.15 billion, and internal return of –6.4%.The paper provides evidence that a state-owned firm with goodgovernance could deliver superior performance.     

PUBLIC PROGRAMS PARE POVERTY: EVIDENCE FROM CHILE

This study examines the effect of government health care and education programs on the poor in Chile from 2000 to 2006. Results are obtained from a country-wide provincial-level panel data set with information on poverty and indigence head-count ratios, measures on the severity of poverty as captured by the Foster–Greer–Thorbecke P ₂ statistic, per capita public expenditures on health and education, as well as other variables that are thought to influence well-being. We use fixed-effects techniques to correct for time-invariant province-specific characteristics that may affect program placement. Our analysis demonstrates that per capita public health and education expenditures significantly reduce the incidence of poverty and indigence in Chile. In particular, for a 10,000 pesos (about $23) increase in provincial per capita health spending, the poverty head-count ratio decreases by 0.48 percent. Per capita education expenditures are particularly important to reducing the severity of poverty. Our results indicate that for a 10,000 pesos increase in education spending, the severity of poverty declines by as much as 1.53 percent. Furthermore, we provide evidence that public spending in Chile is non-random. In particular, government education expenditures may be allocated in keeping with compensatory motives.     

The economic fertility of industrial projects

The economic impact of two industrial projects was forecast using economic fertility analysis. The results of the analysis suggest that the implementation of projects such as those described here add to the resources of government, enabling them to move closer to realization of social objectives, whereas concurrent decreased government revenues and increased transfer payments based on short term political considerations are directly inflationary and represent a threat to longer term social stability. The two projects were a crude oil petrochemical plant, with an investment of $200 million, and a controlled environment agricultural plant, costing $20 million. Direct, indirect, and induced economic activity for each project were calculated, from which income and employment multipliers, and forward and backward linkages were derived. New government revenues, balance of trade effects, and new capital formation were also forecast. Employment in terms of man-years on construction and in jobs created by the operations, as well as consumer expenditures and personal savings, were other outputs of the analysis. Construction and operation phases of the two projects were more beneficial than an equivalent increase in transfer payments in the generation of longer term effects such as new capital formation, new government revenues, and import-export balance, but were less efficient than increased welfare payments in generating short term effects such as consumer expenditures and short term employment.     

Parties,divided government,and infrastructure expenditures: Evidence from U.S. states

This paper examines the impact of parties and divided government on infrastructure expenditures for transportation, education, and social services in U.S. states. As infrastructure expenditures are considered a bi-partisan priority, we hypothesize that divided governments expand infrastructure spending compared to governments under true Democratic or Republican control. We test this hypothesis using U.S. state-level data over the period 1970 to 2008 and find that divided governments indeed increase expenditures for these budget categories. Specifically, divided governments spend more on transportation than unified Democratic governments, and more on education and social services than unified Republican governments. The effect is most pronounced for the core infrastructure of transportation and even stronger when only looking at capital outlays instead of total expenditures.     

THE VALUE OF SERVCES PROVDED BY THE STOCK OF GOVERNMENT-OWNED FIXED CAPTAL IN THE UNITED STATES, 1948–79

Expanded measures of government product normally include imputations for the services of government capital. This article discusses several approaches to measuring the value of the services of government capital and focuses on the conceptual and empirical difficultes associated with making such imputations. In addition, four sets of alternative estimates for 1948–79 are presented.     

The Welfare and Resouce Allocation Implications of the U.S.Dairy Quotas

This paper examine the welfare and resource allocation implications of the U.S. dairy quotas. A computable general equilibrium model detailing five dairy sectors and nine aggregate sectors is calibrated to a 1989 benchmark of the U.S economy. The model is used to simulate the removal of the U.S.dairy quotas both the with and without a first-best subsidy to maintain a dairy farm output objective. Welfare, production, trade, and employment results are provided. The welfare cost of the U.S dairy quotas ranges from $0.7 to $1.0 billion. The first-best subsidy ranges from $2.0 to $2.3 billion or approximately $1.4 million per full-time equivalent job maintained in the dairy farm sector [F13, Q17]     

The general equilibrium effects of fiscal policy: Estimates for the Euro area

This paper describes a dynamic stochastic general equilibrium model featuring a fraction of non-Ricardian agents in order to estimate the effects of fiscal policy in the Euro area. The model takes into account distortionary taxation on labor and capital income and on consumption, while expenditures are broken down into purchases of goods and services, compensation of public employees and transfers to households. A newly computed quarterly data set of fiscal variables is used. Our results point to the prevalence of mild Keynesian effects of public expenditures. In particular, although innovations in fiscal policy variables tend to be rather persistent, government purchases of goods and services and compensations for public employees have small and short-lived expansionary effects on private consumption, while innovations in transfers to households show a slightly more sizeable and lasting effect. The effects are more significant on the revenue side: decreases in labor income and consumption tax rates have sizeable effects on consumption and output, while a reduction in capital income tax favors investment and output in the medium run. Finally our estimates suggest that fiscal policy variables contribute little to the cyclical variability of the main macro variables.     

Innovation and productivity in manufacturing and service firms in Catalonia: a regional approach

This article analyses the determinants of research and development (R&D) and the role of innovation on labour productivity in Catalan firms. Our empirical analysis found a considerable heterogeneity in firm performances between the manufacturing and service industries and between low- and high-tech industries. The frontiers that separate manufacturing and service industries are increasingly blurred. In Catalonia high-tech knowledge-intensive services (KIS) play a strategic role in promoting innovation in both manufacturing and service industries, and driving growth throughout the regional economy. Empirical results show new firms created during the period 2002–2004 that have a greater R&D intensity than incumbent firms (54.1% in high-tech manufacturing industries and 68.8% in high-tech KIS). Small and young firms in the high-tech KIS sector are very prone to carrying out R&D and they invest more in innovation projects. R&D expenditures, output innovation, investment in physical capital, market share and export have positive effects on labour productivity in both the manufacturing and service sectors. Firm size, on the other hand, has a positive effect on productivity in manufacturing industries but not in services.     

非农部门劳动力增长速度研究

根据影响非农部门劳动力增长速度的相关因素,运用C-D生产函数,利用1996～2004年间的非农部门有关数据,对影响非农部门劳动力增长速度的有关因素进行实证分析,结果表明影响我国非农部门劳动力增长速度的主要因素为:资本增长速度、非农部门实物工资增长速度、技术进步引起的劳动边际产出的增长速度和工业劳动边际产出对劳动力的弹性。政府应通过提高资本质量、吸引国外投资,保持物价稳定、控制工资上涨,加强创新力度,提高员工技能以促进非农部门劳动力增长。     

Provincial government expenditures in Canada: an empirical analysis

Most empirical studies have sought to explain the overall growth of the total government expenditures. Few studies have focused on the growth of spending at the provincial level. This article seeks to fill the gap. It examines the growth of government expenditures in Canadian provinces. Data spanning the past three decades are used to explain the growth of provincial government expenditures in Canada and to test alternative hypotheses. From a basic general theoretical model, three empirical models are developed and tested. It is concluded that the growth of the private sector share of the Provincial Gross Domestic Product (PGDP), capacity utilization and factors such as federal transfer payments to the provincial governments best explain the growth in expenditure at the provincial level. The expenditure policies of provincial governments are found to be independent of the political stance of the political parties in power. Estimated short-run and long-run ‘income’ elasticities of provincial government expenditures with respect to PGDP reveal that government expenditures have grown in proportion to PGDP. The growth of provincial spending over the last three decades has been stimulated by the demand for services (such as education and health) and by federal transfer payment programmes through their combined income and substitution effects.     

The determination of government expenditure for short-term forecasting and policy simulation models

This paper analyzes the way short-term forecasting and policy simulation models currently treat government expenditure and the extent to which available research is indicative of future developments for this sector. Emphasis is placed on the problems of, and the necessity for, developing endogenous equations for the various transfers and goods and services expenditures. Consideration is also given to the adaption of budget estimates to form endogenous or exogenous variables for the models, the distinctive problems of including state and local government sectors, and the interaction of the different parts of government expenditure with the rest of the model.     

Battery technology for electric and hybrid vehicles: Expert views about prospects for advancement

In this paper we present the results of an expert elicitation on the prospects for advances in battery technology for electric and hybrid vehicles. We find disagreement among the experts on a wide range of topics, including the need for government funding, the probability of getting batteries with Lithium Metal anodes to work, and the probability of building safe Lithium-ion batteries. Averaging across experts we find that U.S. government expenditures of $150 M/year lead to a 66% chance of achieving a battery that costs less than $200/kWh, and a 20% chance for a cost of $90/kWh or less. Reducing the cost of batteries from a baseline of $384 to $200 could lead to a savings in the cost of reducing greenhouse gases of about $100 billion in 2050.     

Interactions Between Government and Private Outlays: Education in Australia, 1949-50 to 1981-82*

This paper recognizes that government and private final expenditures cannot be modelled in isolation from each other when the expenditure relates to a good such as education which is supplied by both sectors. The inter-relationships in education expenditure are particularly direct in Australia where the private price of private schooling has been lowered substantially by government grants. Annual data are used to quantify the inter-relationships.     

Growth and dynamics of Australia's education exports

Australia is the third largest global exporter of education services and generated $18.6 billion in 2009–2010. The education sector ranks as the top services exports and number three of all export earners in recent years after coal and iron ore. This study analyses the major determinants of Australia's education exports. Using the Johansen cointegration technique, a stable long run relationship is found between education export earnings, real exchange rate, world income and terms of trade. It is also found that policy reforms relating to opening up the education sector from the mid 1980s had a positive growth effect on the sector.