AN APPRAISAL OF GOVRNMENT PURCHASING1
| DOI | http://doi.org/10.1111/j.1467-9485.1963.tb00915.x |
| Author | Ian G. Stewart |
| Date | 01 February 1963 |
| Published date | 01 February 1963 |
AN APPRAISAL OF GOVERNMENT PURCHASING'
IAN
G.
STEWART
I.
THE
object of this article is two-fold. First of all, it is to present
information on the purchases made on current account by public
authorities in the United Kingdom during the post-war period. In
the second place, it is to suggest that, for purposes of both theoretical
and
empirical analysis, the
compositioti
as well
as
the aggregate level
of
the public sector's current expenditure on goods and services is
important.2 Some of the information offered here will, therefore, be
presented in such
a
way
as
to point to new lines of fruitful empirical
enquiry. The improvements and innovations that have taken place in
national income and social accounting during recent years open the
door
for
a
more detailed empirical approach to many of the problems
hitherto discussed only
in
broad aggregative terms. Amongst these
problems may be listed the impact of changes
in
public purchases
on the levels of income, output and employment in different private
sectors
of
the economy," the possible redistributional effects on
real
income of
a
re-alignment of current government spending (these may
outweigh the marginal redistributional impact
of
changing transfer
payments), and the implications for the rate of economic growth of
a
concentration
of
public buying at one
or
other end of the range of
large-medium-small firms.
It
will be evident that any system of
analysis which offers scope for fresh enquiry into aspects
of
multiplier
theory, welfare economics and the study of market structures and
growth should commend itself
as
a
useful addition to the expanding
cosmos of applied economics.
While there are many criteria by which aggregate current expendi-
tures by public authorities could conceivably be subdivided, the
treatment adopted in Part
I1
will be to relate purchases by all govern-
ment bodies to an industrial rather than to the traditionally functional
'This article forms part of a study of Government Purchasing Policies
conducted at the University
of
Edinburgh under the supervision of Professor
Alan
T.
Peacock. The author is indebted to the Rockefeller Foundation for
the support offered
to
this project. The views expressed here ;ire those of
the author and not those
of
the Foundation.
See, for example,
A.
T.
Peacock and
I.
G. Stewart,
'
Fiscal Policy and
the Composition of Government Purchases
'
in
Public
Fimnice.
Vol.
XIII.
1958.
For
an interesting exploration of the possible impact on employment of
different combinations
of
public expenditure. see Alan
M.
Sprout'? article,
'
Primary Employment Effects
of
Alternative Spending Programmes
'
in
Review
of
Econor?iic.s
mid
Stntistics.
Vol.
XL,
November
1958.
13
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