Financial openness drives government size trends, shaping global economic landscapes.
The study looked at how the size of a government and how open a country is to trade and finance are connected. They found that there are two different groups of countries with different trends in government size. In one group, bigger governments are linked to more trade openness, while in the other group, bigger governments are linked to less financial openness. Financial openness has a bigger impact than trade openness on government size. By using a method that classifies countries based on their characteristics, the researchers were able to better understand how government size and openness are related.