The Role of Government Spending in Reducing Poverty Levels

Abstract

Government spending plays a pivotal role in shaping economic outcomes and reducing poverty levels. By allocating resources to social services, infrastructure, and direct transfers, governments aim to improve the living conditions of disadvantaged populations. This study empirically investigates the relationship between government spending and poverty reduction using cross-country and country-specific data. Findings suggest that targeted spending on health, education, and social welfare programs significantly reduces poverty, whereas indiscriminate expenditure or poor governance may undermine its impact. The study highlights the importance of strategic allocation and effective implementation of public funds to maximize poverty alleviation outcomes.