Stephen Gordon crunches the numbers, makes a graph, and concludes that there's just about no relationship at all. Government, it turns out, has relatively little effect on growth. It's the type of government and the type of taxes that matter. The Nordic economies have high taxes on consumption and low taxes on capital income, a mix they're able to achieve in no small part because their citizens -- particularly the poorer ones who are hurt worst by consumption taxes -- are comfortable in the knowledge that the government they're funding will provide for them.
