Governments used to spend 12% of GDP. Growth was faster. What happened?
Before World War II, Western European governments spent roughly 10–15% of GDP and annual per-capita growth ran at ~2–3% — consistent with where the power law curve projects at those spending levels. The post-war expansion of the welfare state shifted every major Western economy rightward along the curve into the low-growth zone. Where high-spending economies have sustained rapid growth, compositional factors — high investment shares, catch-up convergence, or off-budget financing — tend to account for the exception.