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Fiscal Flows and Financial Markets: To What Extent Do They Provide Risk Sharing within Sweden?

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  • Linda Andersson

Abstract

Andersson L. Fiscal flows and financial markets: to what extent do they provide risk sharing within Sweden?, Regional Studies. The objective of this paper is to analyse the amount of risk sharing that takes place between regions in Sweden. It is found that the capital market is the largest source of risk sharing of an exogenous change in gross regional product in Sweden. Still, roughly 20% of a change in regional output is smoothed among the regions through the fiscal system. There is also some evidence that there are regional differences in the sense that regions located in the south rely more on the capital market as a source of insurance against shocks in output, while the tax and transfer systems provide a larger extent of risk sharing for regions located in the north. [image omitted] Andersson L. Flux fiscaux et marches financiers: dans quelle mesure assurent-ils le partage de risques en Suede?, Regional Studies. L'objet de cette communication est d'analyser l'importance du partage de risques entre regions suedoises. Nous observons que le marche financier est la plus importante source de partage de risques d'un echange exogene du produit regional brut en Suede. Et pourtant, environ 20% d'un changement de la production regionale sont lisses entre les regions via le systeme fiscal. Il existe egalement des elements probants de differences regionales dans le sens ou les regions du sud dependent davantage des marches financiers comme source d'assurance contre les perturbations affectant la production alors que les systemes fiscaux et de transfert instillent une plus grande dose de partage de risques dans les regions du nord. Partage de risques Impots Transferts Relations intergouvernementales Marche financier Andersson L. Fiskalstrome und Finanzmarkte: In welchem Ausmass ermoglichen sie in Schweden eine Risikoteilung?, Regional Studies. In diesem Beitrag wird der Umfang der Risikoteilung zwischen den Regionen von Schweden analysiert. Wir stellen fest, dass der Kapitalmarkt die grosste Quelle fur die Teilung des Risikos einer exogenen Veranderung des Bruttoregionalprodukts in Schweden darstellt. Dennoch werden weiterhin etwa 20 Prozent von Veranderungen der Regionalleistung uber das Fiskalsystem innerhalb der Regionen ausgeglichen. Ebenso liegen Anzeichen fur regionale Unterschiede in dem Sinn vor, dass sich die Regionen im Suden starker auf den Kapitalmarkt als Quelle der Absicherung gegen Storungen in der Leistung verlassen, wahrend in den nordlichen Regionen die Steuer- und Transfersysteme einen grosseren Teil der Risikoteilung ubernehmen. Risikoteilung Steuern Transfers Beziehungen zwischen Regierungen Kapitalmarkt Andersson L. Flujos fiscales y mercados financieros: ¿En que medida ofrecen riesgo compartido en Suecia?, Regional Studies. El objetivo de este articulo es analizar la cantidad de riesgo compartido que existe en las regiones suecas. Observamos que en Suecia el mercado capital es la mayor fuente de riesgo compartido de un cambio exogeno en el producto regional bruto. Aun asi, aproximadamente el 20 por ciento de un cambio en la produccion regional se atenua entre las regiones a traves del sistema fiscal. Tambien hay pruebas de que existen diferencias regionales puesto que las regiones ubicadas en el sur dependen en mayor medida del mercado capital como fuente de seguro contra choques en la produccion mientras que para las regiones del norte los sistemas impositivos y de transferencias son una fuente mas importante de riesgo compartido. Riesgo compartido Impuestos Transferencias Relaciones intergubernamentales Mercado capital

Suggested Citation

  • Linda Andersson, 2008. "Fiscal Flows and Financial Markets: To What Extent Do They Provide Risk Sharing within Sweden?," Regional Studies, Taylor & Francis Journals, vol. 42(7), pages 1003-1011.
    • Handle: RePEc:taf:regstd:v:42:y:2008:i:7:p:1003-1011
    DOI: 10.1080/00343400701654129
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    3. Buch, Claudia M. & Körner, Tobias & Weigert, Benjamin, 2013. "Towards Deeper Financial Integration in Europe: What the Banking Union Can Contribute," IWH Discussion Papers 13/2013, Halle Institute for Economic Research (IWH).
    4. Bofinger, Peter & Schnabel, Isabel & Feld, Lars P. & Schmidt, Christoph M. & Wieland, Volker, 2015. "Zukunftsfähigkeit in den Mittelpunkt. Jahresgutachten 2015/16 [Focus on Future Viability. Annual Report 2015/16]," Annual Economic Reports / Jahresgutachten, German Council of Economic Experts / Sachverständigenrat zur Begutachtung der gesamtwirtschaftlichen Entwicklung, volume 127, number 201516.
    5. Masayoshi Hayashi, 2012. "Channels of Stabilization in a System of Local Public Health Insurance: The Case of the National Health Insurance in Japan," CIRJE F-Series CIRJE-F-847, CIRJE, Faculty of Economics, University of Tokyo.
    6. Feld, Lars P. & Schaltegger, Christoph A. & Studerus, Janine, 2018. "Regional risk sharing and redistribution: The role of fiscal mechanisms in Switzerland," Freiburg Discussion Papers on Constitutional Economics 18/02, Walter Eucken Institut e.V..
    7. Joongsan Ko, 2020. "Intranational Consumption Risk Sharing in South Korea: 2000–2016," Asian Economic Journal, East Asian Economic Association, vol. 34(1), pages 29-49, March.
    8. Wei‐Fong Pan & James Reade & Shixuan Wang, 2022. "Measuring US regional economic uncertainty," Journal of Regional Science, Wiley Blackwell, vol. 62(4), pages 1149-1178, September.
    9. Fiorelli, Cristiana & Giannini, Massimo & Martini, Barbara, 2022. "Private and public risk sharing across Italian regions," Journal of Macroeconomics, Elsevier, vol. 74(C).

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