This paper shows that there is an inverted U-shaped relationship between public employment and economic growth. The government allocates workers to the production of public goods, which reduces operational costs, increasing the number of firms in the market, and creating incentives to innovate. Conversely, large public sectors crowd out the labor market, reducing the number of firms and the incentives to innovate. An extension of the model shows that the average human capital of public workers has the same relationship with economic growth. Therefore, even countries with small public sectors can hinder economic growth by hiring many high-productivity workers. The paper also provides empirical evidence of an inverted U-shaped correlation between the share of public workers and economic growth using data from the Worldwide Bureaucracy Indicator and the Penn World Tables. Numerical exercises show that the model replicates the inverted U-shaped relationship between public employment and economic growth found in the data.

本文表明，公共就业与经济增长之间存在倒U型关系。政府将工人分配到公共​​产品的生产中，这降低了运营成本，增加了市场中的公司数量，并创造了创新动力。相反，大型公共部门排挤了劳动力市场，从而减少了公司数量并降低了创新动机。该模型的扩展表明，公职人员的平均人力资本与经济增长具有相同的关系。因此，即使公共部门较小的国家也可以通过雇用许多高生产率工人来阻碍经济增长。本文还提供了经验证据，使用了来自全球官僚机构指标和宾州世界表的数据，公职人员所占份额与经济增长之间呈倒U型相关性。数值实验表明，该模型复制了数据中发现的公共就业与经济增长之间的倒U形关系。