First, there is Wagner’s Law of Increasing State Activity. According to Wagner, a German economist, there are inherent tendencies for the activities of the Government to increase both extensively and intensively. In other words, according to this law as an economy develops over time, the activities or functions of the Government increase.
With the development of the economy, new functions and activities are undertaken by the Government and old functions are performed more thoroughly. The expansion in the Government functions and activities leads to the increase in public expenditure. Though Wanger based his law on the historical evidence drawn from economic growth of Germany, this applies equally to other countries, both developed and developing ones.