Question

What does government spend its money on? Have these expenditures changed overtime and how do they compare across countries? Which expenditures occur at the federal, state and local government level?

Answer 1

Government spend most of its money on goods and services which are not provided by the private sector.Defense , roads, bridges, merit goods like hospitals and schools,unemployment benefits and social security .

Government spending has changed over time.Government spending has increased very fast in the past 50 years.In 1962 government spending was $707 billion and was 18% of US GDP.In 2011 it had increased to $3.6 trillion and was 24% of GDP.

In the early 20th century government spending increased in early industrialized countries. Government spending increased in healthcare,social security and in education in those countries

Recently it has been observed that government spending in high income countries has increased as it lays more stress  on social protection , compared to low income countries .

.Defense , roads, bridges, merit goods like hospitals and schools,unemployment benefits and social security are all federal government expenditures State and local governments spend on education, health and social service programs..About one third of state and local spendingie 21% goes towards providing elementary and secondary education and 10% towards hugher education.