Taxes, Public Spendings, and Economic Growth in OECD Countries

In the OECD, countries with higher tax GDP ratio generally had lower growth rates compared to other countries with lower size of the public sector. These differences have historical roots and result in variation in collective preferences, constraints on choices public goods and services and minimum standard of social insurance and their willingness to pay for them. They also influence the degree economic freedom of private sector and the role of state in economic management.