Advanced Search
MyIDEAS: Login

Fiscal Stringency and Fiscal Sustainability in the American States: Panel Evidence

Contents:

Author Info

  • Saeid Mahdavi

    (University of Texas at San Antonio)

Registered author(s):

    Abstract

    Unlike the federal government, most state governments in the U.S. formally operate under statutory or constitutional constraints which limit their ability to run budget deficits and resort to debt financing. A priori, one would expect to find evidence in favor of an intertemporally balanced budget, or fiscal sustainability, among states, especially those that are characterized by a high degree of fiscal stringency. We test this hypothesis in a panel of 47 contiguous states over the period 1961-2006 using four budget balance definitions and subsamples defined on the basis of whether certain balance budget requirements (BBRs) are in place. Our results, obtained from panel estimation techniques that allow for cross-state dependence, suggest that a sufficient condition for “strong” fiscal sustainability is satisfied in most cases. However, we do not find conclusive evidence that in these cases strong (weak) sustainability is due to the presence (absence) of BBRs.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://business.utsa.edu/wps/eco/0016ECO-90-2010.pdf
    File Function: Full text
    Download Restriction: no

    Bibliographic Info

    Paper provided by College of Business, University of Texas at San Antonio in its series Working Papers with number 0016.

    as in new window
    Length: 28 pages
    Date of creation:
    Date of revision:
    Handle: RePEc:tsa:wpaper:0016

    Contact details of provider:
    Postal: 6900 North Loop 1604 West, San Antonio, TX 78249-0631
    Phone: 210.458.4313
    Fax: 210.458.4308
    Web page: http://business.utsa.edu/wps
    More information through EDIRC

    Related research

    Keywords: Fiscal sustainability; Fiscal stringency; Balance budget rules; States budget; Public finance; Panel cointegration.;

    Find related papers by JEL classification:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:tsa:wpaper:0016. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Eddie Salinas).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.