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The Causal Relationship Between Tax Revenues and Expenditures: Evidence from New York State

  • Rebecca Glover
  • Xueming Luo
  • Mojtaba Seyedian
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    As smaller state budgets become popular among voters, a better understanding of the factors affecting budget balances becomes imperative. This paper tries to shed some light on the issue by analyzing New York State budget data. The results of a Granger-Causality test in conjunction with variance decomposition techniques show that tax revenues, as opposed to expenditures, are the leading factor in creating bigger budgets in New York.

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    File URL: http://nysea.bizland.com/nysea/publications/nyer/2002/NYER_2002_p061.pdf
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    Article provided by New York State Economics Association (NYSEA) in its journal New York Economic Review.

    Volume (Year): 33 (2002)
    Issue (Month): 1 ()
    Pages: 61-66

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    Handle: RePEc:nye:nyervw:v:33:y:2002:i:1:p:61-66
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    1. Darrat, Ali F & Gilley, Otis W & Meyer, Don J, 1996. "US Oil Consumption, Oil Prices, and the Macroeconomy," Empirical Economics, Springer, vol. 21(3), pages 317-34.
    2. von Furstenberg, George M & Green, R Jeffrey & Jeong, Jin-Ho, 1986. "Tax and Spend, or Spend and Tax?," The Review of Economics and Statistics, MIT Press, vol. 68(2), pages 179-88, May.
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