WAGNERS LAW, PUBLIC-SECTOR PATTERNS, AND GROWTH OF PUBLIC-ENTERPRISES IN TAIWAN

Empirical evidence based on public expenditure patterns over a 24-year period casts doubt on the existence of Wagner's Law, the displacement effect, and budgetary recentralization in Taiwan, while supporting the Beck hypothesis of declining real public sector size, the concentration effect, and decentralized centralization. As is true of existing studies on other developing countries, higher profit rates were found in joint public/private enterprises than in wholly owned public firms. However, public enterprises in Taiwan, unlike those in most developing countries, consistently contributed to rather than drained from public revenue. As a result of this and of their relatively large contribution to capital formation, public enterprises played an important role in Taiwan's impressive economic growth record. © 1979, Sage Publications. All rights reserved.