The name is absent



Table 3 presents some descriptive statistics on government consumption in the world sample,
and social expenditures for OECD countries, including its single components. The variance in
social expenditures is slightly higher than that for government consumption, both overall and
within countries. The within country variation, for which we identify the effects on student
achievement, constitutes 7-8 percent of the overall variance. Pension spending is the largest
component of social expenditures, followed by public health spending.

Table 3. Descriptive statistics of government consumption and social expenditures

Obser-
vations

Mean

Standard
deviation
overall

Standard
deviation
within
countries

Minimum
value

Maximum
value

General government consumption
spending, percent of GDP

232
(OECD)

17.65

5.39

1.46

5.69

41.47

General government consumption
spending, percent of GDP

124
(OECD)

18.90

4.22

1.05

10.08

29.62

Public sector social expenditures,
percent of GDP

124
(OECD)

19.62

5.61

1.62

2.8

32.5

Active labor market policy
spending, share of GDP

120
(OECD)

0.61

0.44

0.20

0

2.2

Public health spending, share of
GDP

124
(OECD)

5.56

1.28

0.55

1.4

8.3

Family allowance spending, share
of GDP

124
(OECD)

1.90

1.08

0.31

0

4.1

Unemployment benefit spending,
share of GDP

120
(OECD)

1.17

0.90

0.44

0

4.4

Pension spending,
share of GDP

124
(OECD)

6.38

2.76

0.76

0.6

12.8

Housing spending,
share of GDP

102
(OECD)

0.42

0.39

0.17

0

1.8

Other social spending,
share of GDP

99
(OECD)

4.00

1.38

0.64

1.50

8.90

The third measure of the generosity of the welfare state we employ is an index of income tax
rate progressivity developed by the
Fraser Institute (Gwartney and Lawson, 2002). The index
constitutes an income-bracket adjusted marginal tax rate levied in the highest income bracket
in one country, adjusted for the lowest income threshold for this income bracket. The
redistributive impact of a given tax rate depends on the financial threshold from which on the
rate applies. The top tax rate index of the Fraser Institute is therefore adjusted for threshold
effects to facilitate comparability of the marginal top income tax rate across countries and

14



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