Economics · Public Finance
In the public expenditure theory of Peacock and Wiseman, what does the 'concentration effect' describe?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1A phenomenon where central fiscal economic activities occupy an increasing share of the public sector, and public revenue stabilizes at a higher plateau after a social disturbance.✓
- 2The smooth, non-disruptive rise in public expenditure predicted by Wagner's Law.
- 3A theory explaining structural shifts in political demands increasing government responsibility.
- 4A hypothesis suggesting a gradual, continuous automatic increase in public expenditure over time.
Correct answer
A phenomenon where central fiscal economic activities occupy an increasing share of the public sector, and public revenue stabilizes at a higher plateau after a social disturbance.
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