Causality Between Taxes and Expenditures in the U.S.: A Multivariate Approach

Benjamin S. Cheng and Ashagre Yigletu

New York Economic Review, 2000, vol. 31, issue 1, 15-26

Abstract: Applying Hsiao's version of the Granger causality method, this paper reexamines the causality between nominal expenditures and revenues in the United States for the 1946-96 period in a multivariate framework. Both the Engle-Granger two-step and Johansen canonical cointegration tests are performed. This study finds that taxes, spending, and GDP are cointegrated. While this study detects no evidence of causality between revenues and expenditures, it is found that income causes both revenues and expenditures in the Granger sense in the United States.

Date: 2000
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.nyecon.net/nysea/publications/nyer/2000/NYER_2000_p015.pdf (application/pdf)
http://www.nyecon.net/nysea/publications/nyer/2000/NYER_2000_p015.html (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nye:nyervw:v:31:y:2000:i:1:p:15-26

Access Statistics for this article

New York Economic Review is currently edited by William P. O'Dea

More articles in New York Economic Review from New York State Economics Association (NYSEA) Contact information at EDIRC.
Bibliographic data for series maintained by Eryk Wdowiak ().