Asymmetric modelling of the revenue-expenditure nexus: evidence from aggregate state and local government in the US
This study examines the time series dynamics between US aggregate state and local government receipts and expenditures in differentiating between four hypotheses related to the revenue-expenditure nexus: tax-spend, spend-tax, fiscal synchronization and institutional separation hypotheses. Unlike previous research at the state and local level, the possibility of asymmetries in the budgetary process is explored using the threshold autoregressive (TAR) and momentum threshold autoregressive (MTAR) cointegration framework of Enders and Siklos (2001). The results indicate the absence of any asymmetries (TAR or MTAR) in the adjustment towards budgetary equilibrium. The symmetric error correction model provides support for the spend-tax hypothesis.
Volume (Year): 16 (2009)
Issue (Month): 9 ()
|Contact details of provider:|| Web page: http://www.tandfonline.com/RAEL20|
|Order Information:||Web: http://www.tandfonline.com/pricing/journal/RAEL20|
When requesting a correction, please mention this item's handle: RePEc:taf:apeclt:v:16:y:2009:i:9:p:871-876. 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: (Michael McNulty)
If references are entirely missing, you can add them using this form.