IDEAS home Printed from https://ideas.repec.org/a/kap/pubcho/v59y1988i3p287-290.html

Expenditures and receipts in state and local government finances: Reply

Author

Listed:
  • Michael Marlow
  • Neela Manage

Abstract

It is worth repeating that causality testing is a very complex task. The diversity of views on interpreting the definition of causality and on the methods for testing causality highlight this issue. In our study, we cite an excellent article which provides a detailed critique of various problems associated with causality tests (see Conway, et al., 1984). It would appear that Chowdhury's comment draws very strong conclusions and fails to consider some of the complex theoretical issues regarding causality tests as well as important data problems pertaining to state and local governments. Moreover, we find it somewhat curious that, given the strong similarities in our two studies, Chowdhury prefers to dwell on the mechanics of an alternative technique rather than concentrate on the fact that his alternative technique yields supporting results to our 1987 paper on the tax-spend hypothesis. Copyright Kluwer Academic Publishers 1988

Suggested Citation

  • Michael Marlow & Neela Manage, 1988. "Expenditures and receipts in state and local government finances: Reply," Public Choice, Springer, vol. 59(3), pages 287-290, December.
    • Handle: RePEc:kap:pubcho:v:59:y:1988:i:3:p:287-290
    DOI: 10.1007/BF00118542
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/BF00118542
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/BF00118542?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Mehra, Y P, 1977. "Money Wages, Prices, and Causality," Journal of Political Economy, University of Chicago Press, vol. 85(6), pages 1227-1244, December.
    2. Michael Marlow & Neela Manage, 1987. "Expenditures and receipts: Testing for causality in state and local government finances," Public Choice, Springer, vol. 53(3), pages 243-255, January.
    3. Conway, Roger K. & Swamy, P. A. V. B. & Yanagida, John F. & Muehlen, Peter von zur, 1984. "The Impossibility of Causality Testing," Journal of Agricultural Economics Research, United States Department of Agriculture, Economic Research Service, vol. 36(3), pages 1-19.
    4. Paul R. Blackley, 1986. "Causality Between Revenues and Expenditures and the Size of the Federal Budget," Public Finance Review, , vol. 14(2), pages 139-156, April.
    5. Williams, David & Goodhart, C A E & Gowland, D H, 1976. "Money, Income, and Causality: The U.K. Experience," American Economic Review, American Economic Association, vol. 66(3), pages 417-423, June.
    6. Abdur Chowdhury, 1988. "Expenditures and receipts in state and local government finances: Comment," Public Choice, Springer, vol. 59(3), pages 277-285, December.
    7. Guilkey, David K & Salemi, Michael K, 1982. "Small Sample Properties of Three Tests for Granger-Causal Ordering in a Bivariate Stochastic System," The Review of Economics and Statistics, MIT Press, vol. 64(4), pages 668-680, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Biswajit Maitra, 2011. "Tax-and-Spend Principle in Budget Management in Sri Lanka in the Post-reform Period," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 5(3), pages 343-359, August.
    2. Teresa Famulska & Jan Kaczmarzyk & Malgorzata Grzaba, 2020. "The Relationship Between Tax Revenue and Public Social Expenditure in the EU Member States," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 1136-1156.
    3. Natalia Krasnopeeva, 2023. "Revenues and expenditures of Russian regional budgets: Granger causality analysis," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 70, pages 5-33.
    4. James Payne, 1997. "The tax-spend debate: the case of Canada," Applied Economics Letters, Taylor & Francis Journals, vol. 4(6), pages 381-386.
    5. James W. Saunoris, 2015. "The Dynamics of the Revenue–Expenditure Nexus," Public Finance Review, , vol. 43(1), pages 108-134, January.
    6. James E. Payne, 2003. "A Survey of the International Empirical Evidence on the Tax-Spend Debate," Public Finance Review, , vol. 31(3), pages 302-324, May.
    7. Matthew Zapf & James Payne, 2009. "Asymmetric modelling of the revenue-expenditure nexus: evidence from aggregate state and local government in the US," Applied Economics Letters, Taylor & Francis Journals, vol. 16(9), pages 871-876.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sarker, Rakhal, "undated". "Testing Causality in Economics: A Review," Department of Agricultural Economics and Business 258629, University of Guelph.
    2. James E. Payne, 2003. "A Survey of the International Empirical Evidence on the Tax-Spend Debate," Public Finance Review, , vol. 31(3), pages 302-324, May.
    3. M. Haider Hussain, 2004. "On the Causal Relationship between Government Expenditure and Tax Revenue in Pakistan," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 9(2), pages 105-117, Jul-Dec.
    4. Mohsen Mehrara & Abbas Ali Rezaei, 2014. "The Relationship between Government Revenue and Government Expenditure in Iran," International Journal of Academic Research in Business and Social Sciences, Human Resource Management Academic Research Society, International Journal of Academic Research in Business and Social Sciences, vol. 4(3), pages 171-182, March.
    5. Abdur R. Chowdhury, 1991. "A Causal Analysis of Defense Spending and Economic Growth," Journal of Conflict Resolution, Peace Science Society (International), vol. 35(1), pages 80-97, March.
    6. Abdur Chowdhury, 1988. "Expenditures and receipts in state and local government finances: Comment," Public Choice, Springer, vol. 59(3), pages 277-285, December.
    7. Emre BULUT & Dilek ÇİL, 2024. "Asymmetric Causality Relationship Between Public Expenditures and Tax Revenues: Transition Economies Case," Sosyoekonomi Journal, Sosyoekonomi Society, issue 32(60).
    8. Matthew Zapf & James Payne, 2009. "Asymmetric modelling of the revenue-expenditure nexus: evidence from aggregate state and local government in the US," Applied Economics Letters, Taylor & Francis Journals, vol. 16(9), pages 871-876.
    9. Narayan, Paresh Kumar, 2005. "The government revenue and government expenditure nexus: empirical evidence from nine Asian countries," Journal of Asian Economics, Elsevier, vol. 15(6), pages 1203-1216, January.
    10. M. Haider Hussain, 2005. "On the Causal Relationship between Government Expenditure and Tax Revenue in Pakistan," Macroeconomics 0509014, University Library of Munich, Germany.
    11. repec:tsa:wpaper:0090eco is not listed on IDEAS
    12. Michael Marlow & William Orzechowski, 1988. "Controlling leviathan through tax reduction," Public Choice, Springer, vol. 58(3), pages 237-245, September.
    13. Knapp, Tom & Mookerjee, Rajen, 1996. "Population growth and global CO2 emissions : A secular perspective," Energy Policy, Elsevier, vol. 24(1), pages 31-37, January.
    14. Yaya Keho, 2010. "Spending Cuts or Tax Adjustments: How Can UEMOA Countries Control Their Budget Deficits?," International Journal of Business and Economics, School of Management Development, Feng Chia University, Taichung, Taiwan, vol. 9(3), pages 233-252, December.
    15. James Payne, 1997. "The tax-spend debate: the case of Canada," Applied Economics Letters, Taylor & Francis Journals, vol. 4(6), pages 381-386.
    16. Nithin K, 2015. "The Case of Revenue versus Expenditure Optimization in India," Working Papers 1528, Indian Institute of Foreign Trade.
    17. Natalia Krasnopeeva, 2023. "Revenues and expenditures of Russian regional budgets: Granger causality analysis," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 70, pages 5-33.
    18. James W. Saunoris, 2015. "The Dynamics of the Revenue–Expenditure Nexus," Public Finance Review, , vol. 43(1), pages 108-134, January.
    19. Hector O. Zapata & José M. Gil, 1999. "Cointegration and causality in international agricultural economics research," Agricultural Economics, International Association of Agricultural Economists, vol. 20(1), pages 1-9, January.
    20. Claude Diebolt & Cédric Doliger, 2005. "Becker vs. Easterlin. Education, Fertility and Growth in France after World War II," Working Papers 05-03, Association Française de Cliométrie (AFC).
    21. Mark Wheeler, 1991. "Causality in the United Kingdom: Results from an Open Economy," Eastern Economic Journal, Eastern Economic Association, vol. 17(4), pages 439-449, Oct-Dec.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:pubcho:v:59:y:1988:i:3:p:287-290. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.