A study was conducted to examine the following questions: (1) How does the United States compare with Japan, West Germany, and Sweden on the basis of indicators of quality of life?; (2) How does the United States compare on the basis of economic performance since l960?; and (3) What appears to be the relationship in the four countries between the nature of the public sector and economic performance? The study drew on the universe of relevant data on indicators of quality of life and economic performance. The results of these comparisons were then used to examine the proposition that an increasing share of an economy devoted to government spending will act as a deterrent to economic progress, that is, that prosperity can be stimulated by less government involvement. The following were its major conclusions: (l) on the basis of 17 measures of quality of life, the U.S. performance was worst, whereas Sweden's performance was the best; (2) on the basis of 17 measures of economic performance, the United States again scored last among the four countries, and Japan's performance was the best; (3) during the period studied, the growth of civilian government in the United States also lagged behind that of the other three nations; and (4) the United States particularly lags behind these three commercial rivals in the share of its economy devoted to public investment for infrastructure. (A four-page reference list is found at the end of the study.) (NLL)