There are quite different views on the direction and magnitude of the causal relationship between public expenditures and economic growth. According to classical economics, expansionary fiscal policies negatively affect economic growth, but Keynesian economics adopts that public expenditures will increase income through the multiplier mechanism. On the other hand, the Ricardian Equivalence Hypothesis argues that the increase in public expenditures will not affect economic growth. The Wagner Hypothesis assumes a relationship from economic growth to public expenditures. The relationship between these variables are very important in terms of determining the macroeconomic policies. This study examines the causality relationship between public expenditures and economic growth with the Hatemi-J (2011;2012) asymmetric causality test for the G7 countries based on the data from the period of 1950-2011. According to the findings, while there is a causality relationship from public expenditures to economic growth in Germany, United Kingdom, Italy, Japan, and Canada. There is a causal relationship from economic growth to public expenditures in Japan and U.S. There is no causal relationship between these variables in France.