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The Impact of State and Local Tax and Expenditure Limitations on State Economic Growth
Author(s) -
DELLER STEVEN,
STALLMANN JUDITH I.,
AMIEL LINDSAY
Publication year - 2012
Publication title -
growth and change
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.657
H-Index - 55
eISSN - 1468-2257
pISSN - 0017-4815
DOI - 10.1111/j.1468-2257.2011.00577.x
Subject(s) - restrictiveness , economics , legislature , argument (complex analysis) , state (computer science) , panel data , index (typography) , macroeconomics , public economics , development economics , econometrics , geography , philosophy , biochemistry , linguistics , chemistry , archaeology , algorithm , world wide web , computer science
Employing a unique index of Tax and Expenditure Limitation (TEL) restrictiveness, we estimate a family of economic growth models using a panel of the 50 U.S. states for the period 1969 to 2005. Our central goal is to assess the relationship between TEL restrictiveness and economic growth. Results suggest that stronger TELs imposed on state governments have a dampening effect on state economic growth and TELs imposed on local governments have a weak negative impact on growth. The results do not support the argument that legislatures can use tax and expenditure limits as a mechanism to promote economic growth.