Liability-Creating Versus Non-Liability-Creating Fiscal Stabilization Policies: Ricardian Equivalence, Fiscal Stabilization and EMU
Tamim Bayoumi and
Paul Masson ()
No 1984, CEPR Discussion Papers from C.E.P.R. Discussion Papers
This paper looks at theoretical and empirical issues associated with the operation of fiscal stabilizers within an economy. It argues that such stabilizers operate most effectively at a national, rather than local, level. As differing cycles across regions tend to offset each other for the country as a whole, national fiscal stabilizers are not associated with the same increase in future tax liabilities for the region as local ones. Accordingly, the negative impact from the Ricardian effects associated with these tax liabilities is smaller. Empirical work on data across Canadian provinces indicates that local stabilizers are only one-third to one-half as effective as national stabilizers which create no future tax liability.
Keywords: Fiscal Stabilization; levels of government; Ricardian Equivalence (search for similar items in EconPapers)
JEL-codes: E63 H31 H77 (search for similar items in EconPapers)
References: Add references at CitEc
Citations: View citations in EconPapers (16) Track citations by RSS feed
Downloads: (external link)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at email@example.com
Journal Article: Liability-Creating versus Non-liability-Creating Fiscal Stabilisation Policies: Ricardian Equivalence, Fiscal Stabilisation, and EMU (1998)
Working Paper: Liability-Creating Versus Non-Liability-Creating Fiscal Stabilization Policies; Ricardian Equivalence, Fiscal Stabilization, and EMU (1998)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:cpr:ceprdp:1984
Ordering information: This working paper can be ordered from
http://www.cepr.org/ ... ers/dp.php?dpno=1984
Access Statistics for this paper
More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().