Wagner's Hypothesis Research Articles

Impact of sectoral economic performance and fiscal capacity on public health expenditure in South Africa

This study analyses the long-run relationship between, and the direction and magnitude of impact of sectoral economic growth and fiscal capacity on government health expenditure. The study was carried out to validates the Wagner hypothesis from sectoral perspective and revenue-expenditure hypothesis for South Africa for the period 1984–2020. Fully modified least squares and dynamic least squares and canonical cointegration regression were used to achieve the objectives of the study. Empirical regression results showed that there is a negative impact of the secondary sector GDP on public health expenditure. Thus, invalidating the Wagner hypothesis and suggesting that secondary sector GDP cannot serves as an answer for public health expenditure. However, there was a positive relationship between tertiary sector GDP and public health expenditure. The study make case for unceasing provision of an enabling environment that continuously support growth of the tertiary sector.

Does Wagner’s Hypothesis Explain the Dynamics of Health Expenditures in Transition Countries?

The purpose of this study is to analyze the short and long run causal relationship between public health expenditure and GDP per capita in transition economies within the context of the Wagner hypothesis. For the period 2000-2020, the empirical analysis was conducted using a dataset covering 22 transition countries: Latvia, Belarus, Czechia, Georgia, Bulgaria, Hungary, Estonia, Croatia, Moldova, Bosnia and Herzegovina, Slovenia, Ukraine, Armenia, Lithuania, Russian Federation, Slovak Republic, Romania, Turkmenistan, Uzbekistan, Tajikistan, Kyrgyz Republic, and Kazakhstan. Wagner emphasizes that increases in government expenditure, considered an endogenous variable, do not drive GDP growth. In essence, Wagner argues that a rise in GDP leads to an increase in government expenditures. The study assessed the validity of Wagner’s hypothesis by applying the Panel Cross-Sectionally Augmented Autoregressive Distributed Lag model (CS-ARDL), developed by Chudik et al. (2016), using annual data. For the empirical analysis, panel data from selected transition countries underwent causality tests proposed by Juodis, Karavias and Sarafidis (2021) and Dumitrescu and Hurlin (2012). The stationarity of the series was assessed using a panel unit root test. Subsequently, the panel cointegration test developed by Westerlund (2007) was employed to ascertain the long run cointegration of the variables in the subsequent phase. The results suggest that the Wagner hypothesis holds true within the context of transition countries, as indicated by the outcomes of the CS-ARDL model. The causality test revealed a one-way causal linkage between GDP per capita and health expenditure. Recommendations for those who make policy decisions were made in light of the findings.

Generalized strain-based finite element for non-linear stability analysis of beams with thin-walled open cross-section

Based on the generalized strain theory a shear-deformable finite element is developed for nonlinear stability analysis of thin-walled open-section beams in multibody systems. In this formulation a finite number of deformations, characterized as generalized strains, is defined which are related to dual stress resultants in a co-rotational frame. The stiffness formulation is based on a second-order approximation of the local elastic displacement field. Timoshenko’s beam theory and Vlasov’s modified thin-walled beam theory are used to include the shear strain effects due to non-uniform bending and restrained warping torsion and their mutual coupling effects. Axial shortening associated with the Wagner Hypothesis is taken into account such that the nonlinear behaviour of the beam is predicted accurately, especially under large torsion. Coupling between bending and torsional deformation due to non-coincident centroid and shear centre is modelled using a second-order cross-section transformation matrix. Cubic Hermitian polynomials are used as shape functions for the lateral displacements and twist rotation to derive the elastic and geometric stiffness matrices. Geometric nonlinearities associated with axial elongation and bending curvatures are described by additional torsion, bending and warping-related quadratic deformation terms yielding a set of modified deformations. The inertia properties of the beam are described using both consistent and lumped mass formulations. The latter is used to model rotary and warping inertias of the beam cross-section. The accuracy and the computational efficiency of the new beam element is demonstrated in several static and dynamic examples.

Wagner’s hypothesis in Europe: a causality analysis with disaggregated data

This paper examines Wagner hypothesis of the growth of public expenditure alongside the growth of economic activity for a panel of 28 European economies during the 1995-2018 period. The hypothesis is verified using Pesaran (2007) panel unit root and Westerlund (2007) cointegration tests that account for cross-sectional dependence in the series, and three panel causality tests (Toda-Yamamoto, Dumitrescu-Hurlin and Juodis-Karavias-Sarafidis) that are suitable for mixed order of series’ integration, heterogeneous balanced panels and cases of limited evidence of cointegration. The empirical results suggested that expenditure and output variables were non-stationary in levels and stationary in the first differences; the cointegration among the variables was present; the causality was principally uni-directional (from output to public expenditure), in line with Wagner’s hypothesis, or bi-directional; the causality from public expenditure to output along Keynesian lines was limited.

The Relation of Public Expenditures with Economic Growth in OECD Countries

Many empirical studies have been conducted to analyse the relationship between public spending and economic growth. In the literature review for the analysis of this relationship, the studies are concentrated around Keynes and Wagner Hypothesis. Wagner argues that this relationship is from economic growth to public expenditures while Keynes argues that it is from public expenditures to economic growth. In this study, Keynes's hypothesis is examined through the use ofthe variables of economic growth, public expenditures, inflation and unemployment for some OECD member countries. The findings performed with the panel unit root and panel cointegration tests under the cross-sectional dependency in the analyses are as follows. The variables that make up the study are cointegrated among themselves. In the long-term analysis, a significant relationship was not obtained, which indicates that public expenditures and inflation affect economic growth. It is concluded that unemployment negatively affects economic growth. In the short run, it was found that both public expenditures and inflation positively affected economic growth, while unemployment had a negative effect. In the study, it is concluded that the Keynes Hypothesis is valid for DEU, CZE, GBR, HUN and SVK, but not valid for BEL, FIN and IRL.Key Words: Public Expenditures, Economic Growth, Panel Data AnalysisJEL Classification: H50, O47, C23

Wagner hypothesis in India: An empirical investigation from pre and post reform period

The present study empirically examines the validity of Wagner's hypothesis for Indian economy in pre (1967–1990) and post (1991–2015) reform period. The study examined six alternatives versions of Wagner's hypothesis. The long‐run relationship between government expenditure and economic growth is tested using ARDL model while causal relationship has been investigated using Granger causality test. The results found strong evidence of Wagner's hypothesis during post reform period while the elasticity of government expenditure to economic growth is low in pre reform period. Further, results indicate that unidirectional causality is moving from economic growth to government expenditure in all versions of Wagner's hypothesis.

A Reconsideration of Wagner’s Hypothesis for Nigeria using Linear and Nonlinear ARDL Methods

This study examines the validity of symmetric and asymmetric Wagner's hypothesis for Nigeria using a dataset that spans the period from 1981 to 2016. Five versions of Wagner's hypothesis are specified and estimated with both the linear and nonlinear ARDL techniques. It is found that symmetric Wagner's hypothesis only holds in two of the versions (Peacock and Wiseman, 1961; Goffman, 1968). Only short-run asymmetric relationship exists between government expenditure and economic growth. However, cointegration exists between government expenditure and economic growth using linear and nonlinear ARDL. Granger-causality test supports Wagner's law while Toda-Yamamoto causality test produces mixed results. It is recommended that government may need to implement growth-promoting and sustainable expenditure policies so that a steady positive relationship can be established continuously between government expenditure and economic growth from the short to the long run.

A reconsideration of Wagner's hypothesis for Nigeria using linear and nonlinear ARDL methods

A reconsideration of Wagner's hypothesis for Nigeria using linear and nonlinear ARDL methods

Monetarism or Keynesian Discourse in Indonesia

This paper examines the relative effectiveness of fiscal policy and monetary policy in Indonesia during 1970–2015, using the autoregressive distributed lag (ARDL) bounds testing approach to cointegration and Toda–Yamamoto causality. The ARDL results suggest that there is a long-run equilibrium relationship between monetary policy and economic growth in Indonesia. In the short run, money supply is found to positively affect growth while interest rates negatively affect growth. We conclude that monetary policy is more effective than fiscal policy in both the long and the short run. The causality test reveals bidirectional causality between interest rates and growth. Overall, we find that monetary policy has a more profound impact on growth than fiscal policy. Evidence from the causality test in this study supports the Wagner hypothesis and the fiscal synchronisation hypothesis, and shows that there is coordination between the government and the central bank in Indonesia.

The Relationship Between Government Expenditure And Gross Domestic Product In Algeria:, Test Study For Wagner's Law And Keynesian Hypothesis During The Period 1991-2015

The Relationship Between Government Expenditure And Gross Domestic Product In Algeria:, Test Study For Wagner's Law And Keynesian Hypothesis During The Period 1991-2015

Analytical Solutions for the Inelastic Lateral-Torsional Buckling of I-Beams Under Pure Bending via Plate-Beam Theory

The Wagner coefficient is a key parameter used to describe the inelastic lateral-torsional buckling (LTB) behaviour of the I-beam, since even for a doubly-symmetric I-section with residual stress, it becomes a monosymmetric I-section due to the characteristics of the non-symmetrical distribution of plastic regions. However, so far no theoretical derivation on the energy equation and Wagner’s coefficient have been presented due to the limitation of Vlasov’s buckling theory. In order to simplify the nonlinear analysis and calculation, this paper presents a simplified mechanical model and an analytical solution for doubly-symmetric I-beams under pure bending, in which residual stresses and yielding are taken into account. According to the plate-beam theory proposed by the lead author, the energy equation for the inelastic LTB of an I-beam is derived in detail, using only the Euler–Bernoulli beam model and the Kirchhoff-plate model. In this derivation, the concept of the instantaneous shear centre is used and its position can be determined naturally by the condition that the coefficient of the cross-term in the strain energy should be zero; formulae for both the critical moment and the corresponding critical beam length are proposed based upon the analytical buckling equation. An analytical formula of the Wagner coefficient is obtained and the validity of Wagner hypothesis is reconfirmed. Finally, the accuracy of the analytical solution is verified by a FEM solution based upon a bi-modulus model of I-beams. It is found that the critical moments given by the analytical solution almost is identical to those given by Trahair’s formulae, and hence the analytical solution can be used as a benchmark to verify the results obtained by other numerical algorithms for inelastic LTB behaviour.

Empirical Analysis of the Wagner Hypothesis of Government Expenditure Growth in Kenya: ARDL Modelling Approach

Government spending patterns in developing countries have changed dramatically over the last several decades. This paper aims at analysing the relation between government expenditures (GE) and economic growth in Kenya. The study focuses on testing the various versions of Wagner’s hypothesis using Kenya, data from 1967-2012 by an Autoregressive-Distributed Lag (ARDL) model. Overall, we conclude that the Musgrave version is best suited for Kenyan cases since it produced significant long-run and short-run results that were accepted by diagnosis and stability tests. The results rejected Wagner’s hypothesis in Kenya.

Public expenditure and deficit in Spain (1958-2014)

The objective of this study is to analyze a reduced model of the determinants of public spending growth from a demand side perspective. The model is based on the Buchanan and Wagner hypothesis but incorporates several other variables considered as determinants of public spending growth as well. The formulation of two different equations confirmed the influence of deficit on public spending growth during the period 1958-2014. This work provides two contributions to the analysis of public spending determinants in Spain. Firstly, the study period is considerably longer than that of others, and, secondly, unit root and cointegration analysis are used with breakpoints, which, to our knowledge, have not been previously utilized.

The Relationship between Total Production and Public Spending in Mexico: Keynes versus Wagner

This paper studies the relationship between public spending and production in Mexico. It aims to assess the direction of causality between these two variables ranging from economic growth to public expenditure (Wagner hypothesis) or public spending to economic growth (Keynesian hypothesis). Annual time series for the period 1925–2014 of production and public spending in real terms (1970 based) and logarithms were used. The test method involved three steps: 1) unit root tests; 2) cointegration test of Engle and Granger and 3) evidence of causality in the Granger sense. The paper uses five different specifications recommended by the specialized international literature. It was found that the series are stationary with regards first differences and are cointegrated, so we can say there is a long-term relationship. Statistical tests of Granger causality indicated that the Wagner hypothesis does not hold, while the Keynes hypothesis is validated. The study concludes that public spending and its proper management is one of the keys to promoting economic growth in Mexico. Originality/value: Time series for a long-term period, based on official information, something not done previously, were developed. This allowed the results to be more reliable than those presented by other authors. In addition, a modern procedure of econometric estimation, allowing the assessment of the two proposed scenarios was used. The work is relevant in terms of the design of economic policy and the pursuit of development in Mexico.

Testing Wagner's Law at Different Stages of Economic Development

Using historical data from the mid-19th century, we test the validity of Wagner's law of increasing state activity at different stages of economic development for five industrialized European countries: the United Kingdom, Denmark, Sweden, Finland, and Italy. In order to investigate the relation between Wagner's law and development stage, we classify every country into individual stages of income and apply advanced cointegration and vector error-correction analyses. In line with Wagner's hypothesis, our findings show that the relationship between public spending and economic growth has weakened at an advanced stage of development. Furthermore, all countries under review support the notion that Wagner's law may have lost its economic relevance in recent decades.

Wagner's Law in Sri Lanka: An Econometric Analysis

This study examines whether there is empirical evidence that Wagner's law holds in the Sri Lankan economy using time series annual data over the period from 1960 to 2010 for Sri Lanka, applying cointegration and error correction modeling (ECM) techniques. In particular, this study keeps a special focus to examine the validity of six versions of Wagner's hypothesis, which support the existence of long-run relationship between public expenditure and economic growth. The empirical evidence of this study indicates that while there prevail is a short-run relationship between public expenditure and economic growth, the long-run results showed no strong evidence in support of the validity of the Wagner’s law for Sri Lankan economy. Granger causality analysis also confirms this result. Therefore, the findings of this study pave to broaden this study further for a deeper understanding about the relationship between public expenditure and economic growth by giving more attention on individual items of public expenditure and by including more macroeconomic variables in the econometric model using different methodology in future.

The Relationship between Economic Growth and Government Expenditure: Evidence from Sudan

In the economic literature, there are two opposing views on the relationship between economic growth and the size of the government. The Wagner hypothesis states that as the economy grows so does the size of the public sector. This is in contrast to the Keynesian view that the growth of government expenditure results in the growth of GDP. The Wagner hypothesis was tested for different countries and the results were conflicting. The primary objective of this paper is test the Wagner hypothesis in the context of the Sudan for the period 1970-2010. The methodology used is cointegration, causality, and error correction model (ECM). The results for the Sudan indicate that the data for the period considered supports the Wagner’s hypothesis.

A test of the Wagner's hypothesis for the Fiji islands

In this article we examine Wagner's law for Fiji for the period 1970 to 2002. Using the Johansen (1988) test for cointegration, we find one cointegration relationship between national output and government expenditure. Using five different long run estimators, we find robust results on the impact of national income on government expenditure. The elasticity ranges from 1.36 to 1.44, implying that a 1% increase in income leads to a 1.36–1.44% increase in government expenditure. Moreover, we find that in the long run national income Granger causes government expenditure. While these results are consistent with Wagner's law, we warn policy makers that because Fiji's total debt stands at around 69% of GDP, in future the bulk of expenditure will go towards debt financing at the expense of productive sectors.

Wagner's hypothesis

PurposeThe aim of this paper is to prove the validity of Wagner's hypothesis.Design/methodology/approachThe paper examines the validity of Wagner's hypothesis with annual data for Turkey over 1950‐2005 period.FindingsThe empirical results using the ARDL bounds tests of cointegration provide strong support for the hypothesis. Also, the results are robust across six alternative specifications of the Wagner's hypothesis as well as four alternative lag length selection criterions.Originality/valueThe paper provides useful information on the validity of Wagner's hypothesis.

Three Hundred Years of Bar Theory

This analysis reviews the ideas, insights and assumptions that are critical for a comprehensive formulation of a theory for bars. One assumption, the Wagner hypothesis, was thought to be necessary for explaining what appears to be pure torsional buckling when certain bars are compressed. The characterization of the phenomenon as pure torsional buckling is incorrect. The hypothesis is not needed, and without it, the theory returns to a simpler and more rational earlier form. Bar theory had its early beginnings in 1705, when James Bernoulli proposed that the curvature of a bent bar is proportional to the bending moment and that internal resisting couples result from the extensions and contractions of the bar’s longitudinal filaments. Daniel Bernoulli, James’s nephew, communicated the idea to Leonhard Euler in 1742, and Euler, acting on it, solved the elastica problem in 1744 Love 1944 . Later, Euler defined buckling and computed buckling loads. His work laid the foundation of what is known as stability theory. Euler considered a bar as though it were a line of particles that curved in accordance with Bernoulli’s principle. In 1776, Charles Augustin de Coulomb Love 1944 examined the normal planes of a bent bar. By assuming that the profiles did not warp plane sections remain plane and with known or assumed properties for the bar’s material, he was able to determine the neutral axis for bending. From that time, the bar was considered as a threedimensional body for purposes of analysis. It is evident that bar theory rests on “special hypotheses” that make it approximate. Plate and shell theories are also approximate for their dependency on special hypotheses. Such theories are useful and occasionally needed, as when the elasticity solution is not available. They typically supply the stresses, strains, and deformations that most concern the structural engineer and machine designer and are simpler to use than the elasticity theory. The drawback to an approximate theory is that it often produces inconsistent and incomplete results. For example, bar theory is inconsistent when it predicts a transverse shear stress on the normal plane of the bar and neglects the shear strain it should produce. It is incomplete as well because a prismatic bar of irregular cross section will generally not have a true shear center and shear centerline so that it is not possible to know whether transverse loads will twist the bar as well as bend it. S. Timoshenko suggested that for some bars, the error might be small if the centroid line is also taken to be the shear centerline. Elasticity theory is considered to be exact because its results are complete and consistent. However, it includes one glaring inconsistency that is masked by specifying that it is meant for use when strains and displacements are small. An analysis begins with the initial configuration of the body, and that configuration is used to express the equilibrium of the deformed body in its final state. If a truer representation is desired, the loads may be incrementally applied and the configuration determined after each in-