Growth and Volatility of Tax Revenues in Latin America
Journal
World Development
ISSN
0305-750X
ISSN-Digital
1873-5991
Type
journal article
Date Issued
2014-02
Author(s)
Abstract
Against the backdrop of high macroeconomic instability and the need to meet the demands of public spending, we analyze the trade-off between growth and volatility of tax revenues in Latin America. Short-run and long-run elasticities for a sample of 11 economies are estimated accounting for state-dependent asymmetric reactions. Controlling for composition of revenue sources and other idiosyncrasies, we find revenues above (below) its long-run equilibrium to react stronger (weaker) to business cycle dynamics. Our detailed elasticity estimates can give some orientation on how to stably reach higher tax levels on the way to develop an adequate internal tax system.
Language
English
Keywords
Tax Policy
Developing Countries
Regime-Dependent Elasticity
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Elsevier Science
Publisher place
Amsterdam
Volume
54
Start page
114
End page
138
Pages
25
Subject(s)
Division(s)
Eprints ID
194993