Government size and citizen satisfaction in China: evidence that accommodates two contrasting views

Abstract

The centuries-old debate on big versus limited government continues to rage unabated worldwide. The findings of a few studies that have examined spending and employment relating to government size in China are mixed. Adopting a “subjective” perspective for evaluating the effect of government size, this paper shows that the likelihood of Chinese citizens being satisfied with three publicly provided services increases with more government expenditures but fewer government employees. Moreover, regardless of spending or employment measures, the relationship between citizen satisfaction and government size takes a quadratic form overall. Our findings accommodate both the welfare state and public choice views on the effect of government size on individual well-being.

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