This paper studies the effect of government size economic growth in selected AEAN
countries. A standard growth model is developed in which the output growth is a
function of the size of government, growth in labor supply and total stock of capital
as percentage of GDP. The estimated results suggest that increase in the capital stock
is the primary factor that helps to grow the economy. Government size did not have
either positive or negative effect on output growth. Growth rate of labor does not
affect the output growth in Thailand, Malaysia, and Indonesia. In case of the
Philippines labor supply seems to have a negative effect on output growth probably
because of excess labor supply in relation to other inputs