Fiscal Capacity, Democratic Institutions and Social Welfare Outcomes in Developing Countries

Murshed, SM; Bergougui, B; Badiuzzaman, M; Pulok, MH

Fiscal Capacity, Democratic Institutions and Social Welfare Outcomes in Developing Countries

Murshed, SM Bergougui, B Badiuzzaman, M Pulok, MH

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Publisher:: Taylor and Francis Group
Publication Type:: Journal Article
Citation:: Defence and Peace Economics, 2022, 33, (3), pp. 280-305
Issue Date:: 2022

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Field	Value	Language
dc.contributor.author	Murshed, SM
dc.contributor.author	Bergougui, B
dc.contributor.author	Badiuzzaman, M
dc.contributor.author	Pulok, MH
dc.date.accessioned	2022-10-31T22:30:01Z
dc.date.available	2022-10-31T22:30:01Z
dc.date.issued	2022
dc.identifier.citation	Defence and Peace Economics, 2022, 33, (3), pp. 280-305
dc.identifier.issn	1024-2694
dc.identifier.issn	1476-8267
dc.identifier.uri	http://hdl.handle.net/10453/163088
dc.description.abstract	© 2020 Informa UK Limited, trading as Taylor & Francis Group. The purpose of this paper is to gauge the various determinants of social sector spending captured by social protection and education spending in a cross section of developing countries, a subject on which there is scant empirical evidence. We hypothesize that fiscal capacity is necessary but not sufficient for resource allocation in this area, because the political will to do so must also be present. Using a panel data instrumental variable approach, we find that greater fiscal capacity robustly raises social spending in developing countries in the period 1990 to 2010. It is also strongly evident that rising democratisation enhances social sector spending; the presence of greater democracy and higher fiscal capacity could reinforce this effect. Our work also innovatively incorporates inequality into the analysis, finding that social expenditure is greater in more egalitarian societies. Military expenditure also appears to crowd out social protection expenditure, but not robustly.
dc.language	English
dc.publisher	Taylor and Francis Group
dc.relation.ispartof	Defence and Peace Economics
dc.relation.isbasedon	10.1080/10242694.2020.1817259
dc.rights	info:eu-repo/semantics/openAccess
dc.subject	1402 Applied Economics
dc.subject.classification	Strategic, Defence & Security Studies
dc.title	Fiscal Capacity, Democratic Institutions and Social Welfare Outcomes in Developing Countries
dc.type	Journal Article
utslib.citation.volume	33
utslib.for	1402 Applied Economics
pubs.organisational-group	/University of Technology Sydney
pubs.organisational-group	/University of Technology Sydney/DVC (International)
utslib.copyright.status	open_access	*
pubs.consider-herdc	false
dc.date.updated	2022-10-31T22:30:00Z
pubs.issue	3
pubs.publication-status	Published
pubs.volume	33
utslib.citation.issue	3

Abstract:

© 2020 Informa UK Limited, trading as Taylor & Francis Group. The purpose of this paper is to gauge the various determinants of social sector spending captured by social protection and education spending in a cross section of developing countries, a subject on which there is scant empirical evidence. We hypothesize that fiscal capacity is necessary but not sufficient for resource allocation in this area, because the political will to do so must also be present. Using a panel data instrumental variable approach, we find that greater fiscal capacity robustly raises social spending in developing countries in the period 1990 to 2010. It is also strongly evident that rising democratisation enhances social sector spending; the presence of greater democracy and higher fiscal capacity could reinforce this effect. Our work also innovatively incorporates inequality into the analysis, finding that social expenditure is greater in more egalitarian societies. Military expenditure also appears to crowd out social protection expenditure, but not robustly.

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http://hdl.handle.net/10453/163088