Real growth of government expenditure, Gini index, exports and economic growth: A cross-sectional study

Abstract

This study attempts to describe the relationship between economic growth (Taken measured by the growth of per capita GDP), government consumption expenditure, exports, and inequality (To measure it uses the Gini coefficient). This study uses cross-sectional data across countries from the World Bank website for 2019. To check for a heteroskedasticity study use White’s test and to check the specification of a standard OLS study use the Ramsay Reset test. Our results find an association between economic growth (Dependent variable), government consumption expenditure, exports, and inequality. Government consumption expenditure and export have a significant and positive relation with the economic growth but inequality has significant and negative relation with the economic growth. Our study concludes by saying that government consumption expenditure and exports impact economic growth positively but inequality has a negative impact on economic growth.