The causal nexus of government spending and revenue in Finland: A bootstrap approach
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Date
1998-10-01
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University of Gothenburg
Abstract
Applying VAR(5), a bootstrap simulation approach and a multivariate Rao's F-test indicate that government revenue Granger causes spending in Finland. This does not agree with Barro's tax smoothing hypothesis. The explanation of this is due to the institutional factors that are specific for Finland.
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Keywords
Bootstrap, Government Spending and Revenue, Granger Causality, VAR