Answer to Question #131190 in Macroeconomics for Gift

Question

Government spending (as a percentage of gross domestic expenditure) has
increased significantly over the past decades. Explain any two reasons for this
trend.

Answer 1

The two main reason for the increment of government spending on Gross Domestic Expenditure are following

(i) Social Protection:- The world population is increasing day by day due to this the gap between high level income people and low level income people increasing and to stop their exploitation by high level income people there is increase in government spending on different sectors so that low level income people benefited from this and their over exploitation can be stop.

(ii) Maintain goods and services:- As the increase in population leads to utilization of resources so there is need of proper management of goods and services. Government spending was very important in this to maintain proper balance and utilization of goods and services.