The Assessment of Influenceof Functional Government Expenditure on Subjective Wellbeing in EU

Justinas Kisieliauskas, Jurgis Gabrielius Rudgalvis

Abstract


In this paper, researchers analyze the influence of functional government spending on satisfaction with lifein EU countries. The main problem arises from the theoretical conflict between the traditional view of welfare economists, which states that the government is responsible for maximization of social welfare through real­location of resources against studies proving that government spending has negative effects on social welfare, as the government is not effective in resource reallocation. Research under this topic discloses contradict­ing results on the effect of functional government expenditures on wellbeing, which leaves a place for morein-depth researches on this topic. Does government spending have any effect on one’s wellbeing? Doesincrease in functional spending increase the level of wellbeing? Are there any limitations on government spending? The research compares data of 26 EU countries using graphical and linear regression analysisto answer these questions and to see if there are any turning points, which would show that changes in govern­ment spending may have a contrary effect on wellbeing.


Keywords


Subjective wellbeing; happiness; government functional spending; welfare economics

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DOI: http://dx.doi.org/10.7220/AESR.2335.8742.2017.11.1.1

ISSN 1822-7996 (Print)

ISSN 2335-8742 (Online)