Legislative production and public spending in France
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Legislative production and public spending in France François Facchini1 · Elena Seghezza2 Received: 13 January 2020 / Accepted: 26 October 2020 © The Author(s) 2020
Abstract The aim of this article is to help explain the history of the public spending-to-GDP ratio in France by examining the production of laws and regulations. It empirically finds a positive and significant relationship between the number of pages in the Official Gazette of the French Republic and the development of the public expenditure-to-GDP ratio. We rely on the number of pages in the Official Gazette as a proxy for the cost of implementing laws and regulations. If unchecked, a proliferation of laws and regulations expands public spending. Over the period 1905–2015, a 10% increase in pages caused a 1.14% increase in the public expenditure-to-GDP ratio. Keywords Public spending · Law · “Self-reinforcing” process JEL Classification H61 · K20 · N44
1 Introduction The aim of the present article is to help understand and explain the history of public spending in France. The history of gauging the size of the public sector by computing the public expenditure-to-GDP ratio is now well known. For many years, however, it was thought that one of the shortcomings of nineteenth- and twentieth-century French historiography related to the role of the state in economic development and, more generally, the very history of the state as a governing apparatus or machine (Bouvier 1978; Rosanvallon 1990). A proposed explanation for those shortcomings is the conscious or unconscious domination of the classical liberal approach to capitalism. Indeed, some scholars argue that liberal ideology is incapable of explaining the growth, in the long term, of state interventionism and its influence on economic development and, moreover, that it ignores the decisive role of the state in economic progress (Bouvier 1978). In 1983, Christine André and Robert * Elena Seghezza [email protected] François Facchini francois.facchini@univ‑paris1.fr 1
University of Paris 1 Panthéon-Sorbonne, Centre d’Economie de la Sorbonne, 106‑112 Bd. de L’Hôpital, 75647 Paris, France
2
Department of Political Science, University of Genoa, Piazzale Brignole 3a, 16125 Genoa, Italy
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Public Choice
Delorme (1983) published a book that has become a standard reference.1 According to the authors, the increase in public spending and the role of the state in the economy more broadly was made necessary by market failures and the necessarily conflictual nature of social relations in a capitalist economy. The explanation provided by the Ministry of Finance website for the growth in public spending is largely inspired by this work. It develops the idea that the growth of the public sector does not result from public decisions alone, but from the inability of markets to selfregulate. Endogenous growth theory holds that achieving high levels of economic growth requires ensuring that private enterprises have access to a well-educated and healthy workforce, roads, courthouses, rese
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