The Intergenerational Content of Social Spending: Health Care and Sustainable Growth in China

The paper endorses the thesis that current macro imbalances are partly due to an excess of household savings in China, whose origin is to be found among other things in household uncertainty about the provision of public services like health care, pensions and education. Focusing on health services, because of their priority in the concerns of the Chinese people, we describe the recent trends in the provision of health care. We then argue that social spending by the government may have important intergenerational content, in that it allows higher private spending, lower inequality, higher levels of human capital and the like. All these factors are related to the potential growth rate of the economy. We conclude that a more important role of the government in the sector of public services, and in particular of health care, may help reduce the possibility of future bottlenecks, and hence help keeping the Chinese economy on a sustainable growth path. We conclude the paper by an assessment of the current debate on how to reform the system, and we advocate universal publicly funded basic health coverage.Social Spending, Health Care, Sustainable Growth, Chinese Economy, Savings Glut

Diverging sequences of unit volume invariant metrics with bounded curvature

We study 1-parameter families in the space $\mathscr{M}^G_1$ of $G$-invariant, unit volume metrics on a given compact, connected, almost-effective homogeneous space $M=G/H$. In particular, we focus on diverging sequences, i.e. which are not contained in any compact subset of $\mathscr{M}^G_1$, and we prove some structure results for those which have bounded curvature. We also relate our results to an algebraic version of collapse.Comment: 27 pages. Some minor modifications. Accepted for publication in Ann. Global Anal. Geo

Agricultural and Economic Convergence in the EU Integration Process: Do Geographical Relationships Matter?

In the light of the reaffirmed importance of agricultural convergence within the integration process, the paper provides a preliminary investigation of the impact of the enlargement from the EU-15 to the EU-27 on agricultural real b-convergence and, with reference to the EU-27, of its relationship with economic catching-up process. The empirical analysis, based on a GWR approach, takes into account the regional spatial interdependences in estimating local parameters of convergence. The approach adopted allows to overcome the contradictory results from OLS estimations and parametric spatial econometric models pointed out by the literature and primarily connected to the existence of no unique convergence rate all over Europe. The analysis is based on a sample of 259 EU-27 regions at NUTS 2 level and is referred to the time period from 1991-2007.Regional convergence, Spatial analysis, GWR approach, International Relations/Trade,

Optimal size of government and economic growth in EU-27

Using time-series techniques and panels data, the paper analyses for the EU countries in the period 1970-2009 the existence and shape of the “BARS curve” (Barro, Armey, Rahn, and Scully), connecting the size of Government (measured by the share of public expenditure on GDP) to the rate of economic growth. Individual countries research has been conducted for 12 countries for whom enough time series were available, while panel analysis has been performed both for EU-27 and for subgroups, distinguished by their different socio-economic and monetary structures, and per capita GDP. BARS curves were generally found, and the shares of actual public expenditures generally exceed substantially those related to the maximization of GDP growth. However, great differences do emerge. For the 12 countries examined by time-series techniques, the difference between the actual level and the peak of the BARS curve ranges from 5.7 points for Germany and 18.1 points for Belgium. Panel data analysis for EU-27 shows a peak of the BARS curve at 37%, while the actual level is about 47%. While, panel data disaggregation shows a similar situation for the Western Continental Countries, with a smaller gap for Anglo-Saxon countries. For low per capita GDP countries the peak is higher than for the mature economies. So, further research may prove useful to show light on the disparities emerging in the empirical analysis of individual countries and of the panel sub-groups. However, the present research provides enough evidence that high GDP countries of EU have overcome the level of government size compatible with GDP growth rate maximization.Government size; economic growth; BARS curve; public expenditure; EU-27.

OPTIMAL SIZE OF GOVERNMENT AND ECONOMIC GROWTH IN EU-27

Using time-series techniques and panels data, the paper analyses for the EU countries in the period 1970-2009 the existence and shape of the "BARS curve" (Barro, Armey, Rahn, and Scully), connecting the size of Government (measured by the share of public expenditure on GDP) to the rate of economic growth. Individual countries research has been conducted for 12 countries for whom enough time series were available, while panel analysis has been performed both for EU-27 and for subgroups, distinguished by their different socio-economic and monetary structures, and per capita GDP. BARS curves were generally found, and the shares of actual public expenditures generally exceed substantially those related to the maximization of GDP growth. However, great differences do emerge. For the 12 countries examined by timeseries techniques, the difference between the actual level and the peak of the BARS curve ranges from 5.7 points for Germany and 18.1 points for Belgium. Panel data analysis for EU-27 shows a peak of the BARS curve at 37%, while the actual level is about 47%. While, panel data disaggregation shows a similar situation for the Western Continental Countries, with a smaller gap for Anglo-Saxon countries. For low per capita GDP countries the peak is higher than for the mature economies. So, further research may prove useful to show light on the disparities emerging in the empirical analysis of individual countries and of the panel sub-groups. However, the present research provides enough evidence that high GDP countries of EU have overcome the level of government size compatible with GDP growth rate maximization.Government size; economic growth; BARS curve; public expenditure; EU-27