Examining the fiscal impact of tax and expenditure limitations on municipal governments: a rule design approach

Park, Sungho

doi:10.1080/03003930.2022.2031160

Cited by 5 publications

(3 citation statements)

References 33 publications

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“…In these instances, party affiliation was assigned based on which party maintained control during the majority of the year. Lastly, to account for tax and expenditure limitations (TEL) imposed by the state, which may hinder a government's access to revenue, we utilized the TEL index created by Maher, Park, and Harrold (2016) and measured by Park (2018). This index places each state on a continuous scale of how strict of a TEL the state has adopted.…”

Section: Model Data and Methodologymentioning

confidence: 99%

Do We Really Need Another Municipal Fiscal Health Analysis? Assessing the Effectiveness of Fiscal Health Systems

McDonald,

Maher

2020

Public Finance and Management

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One of the difficulties faced in the effective and efficient management of public organizations is the understanding of when the organization is showing symptoms of financial distress. Administrators and researchers alike have typically relied upon financial condition systems such as Brown's (1993) 10-point test and Wang, Dennis, and Tu's (2007) financial condition index (FCI). the evidence is mounting that these systems are ineffective at predicting fiscally distressed communities; however, previous studies are limited to either case studies or entities in a few states. in an attempt to generalize over a longer period of time and across more states, this analysis utilizes a sample of 150 municipalities for the period of 1977 to 2012. the authors test the efficacy of the measurement approaches with a series of rare event history analyses (EHA) that captures their utility in predicting municipal bankruptcy or state takeover of financial operations. the findings are consistent with previous studies - financial condition systems do not predict fiscally distressed communities. Measures of fiscal reserves and long-term liabilities were more effective at predicting distress, suggesting that scholars should continue to work on the refinement of measures rather than systems of fiscal condition as predictors of fiscal distress.

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Section: Model Data and Methodologymentioning

confidence: 99%

Do We Really Need Another Municipal Fiscal Health Analysis? Assessing the Effectiveness of Fiscal Health Systems

McDonald,

Maher

2020

Public Finance and Management

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“…To date, much of what we know about the taxation versus employment nexus and its impact on public expenditure lies in macroeconomics (Kotlikoff et al, 1984;Shin et al, 2012), through the traditional Keynesian model of economic growth, where taxes affect households consumption through reducing the disposable income available for household consumption if the taxes are high, disable income reduces and thus consumption reduces, and given the fact that under these models income is either consumed or saved, thus a high tax on incomes reduces savings to (Kotlikoff et al, 1984). Empirically there have been several studies investigating the impact of taxes on different macroeconomic various, and these among others include (Almunia et al, 2015;Mawejje & Munyambonera, 2016;Ssewanyana & Okidi, 2008;Terefe & Teera, 2018) in Uganda and (Alloza, 2020;Ameyaw et al, 2015;Bartkus, 2017;Bikas & Jurevičiūtė, 2016;Bilek et al, 2021;Davies et al, 2021;Ewa et al, 2020;Hamoudi, 2019;Hoppe et al, 2020;Hysa, 2019;Levell et al, 2020;Lyeonov & Michalkova, 2021;Merima et al, 2012;Park & Park, 2018;Pohwani et al, 2019;Sahebe et al, 2020;Sari & Mulyati, 2018) conducted elsewhere as discussed below.…”

Section: Empirical Literaturementioning

confidence: 99%

Asymmetric Analysis of the Impact of Taxation on Unemployment in Uganda

Mukoki,

Mukisa,

Ssebulime

et al. 2024

East Afr. j. bus. econ.

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Uganda, like most developing countries, has one of the highest tax rates not only in Africa but also in the world. This explains the numerous challenges faced in mobilizing sufficient revenues to fight poverty and improve people’s economic welfare. We, therefore, use a more recent nonlinear autoregressive distributed lag model (NARDL) to analyze the impact of higher taxes on the unemployment rate in Uganda. Results indicate that total Unemployment in Uganda is a negative function of both an increase in tax and a negative change in tax. Specifically, if taxes increase, then unemployment decreases by almost 3.9%, and if taxes decrease, then unemployment increases by about 4.9%. Also, the unemployment level decreased by 0.06% with a decrease in the gross capital formation (GFKF). Finally, unemployment also decreases with a rise in GDP and decreases with a decrease in GDP. In a nutshell, Uganda lacks the possibility of making the economy more productive and thus only relies on taxing an already overtaxed economy. Overtaxing an economy kills the possibility of ever building a formidable capital base that can stimulate economic growth and reduce poverty and unemployment. The government, therefore, should cut taxes and level the playing field regarding tax policies for foreign and home-grown investors. Finally, policymakers should also aim to unlock the potential of the informal sector not only to create jobs but also to widen the tax base

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“…Local-level TELs are imposed on property assessments, levy rates, revenues, or expenditures. Researchers have found that local TELs decreased and slowed growth of property tax revenues, particularly when controlling for the stringency of tax limits (Dye & McGuire, 1997;Dye et al, 2005;Lowery, 1983;Shadbegian, 1999; for literature reviews, see Downes & Figlio, 2015;McGuire, 1999;Mullins & Wallin, 2004;Park et al, 2018;Stallmann et al, 2017). Evidence of the relationship between local TELs and municipal finances during the Great Recession has indicated that cities and counties with more restrictive TELs experienced greater recession impacts and had less capacity to adjust their finances than did those with less restrictive TELs (Afonso, 2013;Jimenez, 2017;Pagano & Hoene, 2018;Park et al, 2018;Wen et al, 2020;Yang, 2017).…”

Section: Tax and Expenditure Limitationsmentioning

confidence: 99%

The Interplay Between Fiscal Institutions and the Great Recession: Evidence From U.S. School Districts

Buerger,

Lofton

2023

AERA Open

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Recessions may disproportionally affect school districts, especially with established fiscal institutions and policies including balanced budget requirements, tax and expenditure limitations, and school finance reforms. Analyzing the Great Recession and school districts in the United States between 2003 and 2016, we estimated difference-in-differences models leveraging variation in state recession severity to evaluate revenue and expenditure impacts as well as to measure differential recession effects for districts exposed to and not exposed to fiscal institutions and policies. Although revenues and expenditures increased relative to pre-recession levels in all districts, increases were much larger in school districts with less severe than more severe recessions. Balanced budget requirements exacerbated recession effects for low-income districts, and local tax and expenditure limitations intensified recession effects for high-income districts. School finance reforms worsened recession effects for all districts. Our findings can aid districts in understanding potential recessionary impacts, given their prior established fiscal policies and institutions.

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Examining the fiscal impact of tax and expenditure limitations on municipal governments: a rule design approach

Cited by 5 publications

References 33 publications

Do We Really Need Another Municipal Fiscal Health Analysis? Assessing the Effectiveness of Fiscal Health Systems

Do We Really Need Another Municipal Fiscal Health Analysis? Assessing the Effectiveness of Fiscal Health Systems

Asymmetric Analysis of the Impact of Taxation on Unemployment in Uganda

The Interplay Between Fiscal Institutions and the Great Recession: Evidence From U.S. School Districts

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