U.S. State and Local Fiscal Policy and Economic Activity: Do We Know More Now?

Rickman, Dan S. and Wang, Hongbo (2018): U.S. State and Local Fiscal Policy and Economic Activity: Do We Know More Now?

Abstract

Early reviews of the academic literature on the economic effects of state and local taxes and expenditures suggested that not enough was known upon which to base policy. The reviews called for better data and improvements in empirical methodology. This paper reviews studies conducted since the early literature reviews to assess our current state of knowledge. The conclusion of the study is that we know more now. But our knowledge is unlikely to ever be sufficient to provide universal policy guidance. Rather, we suggest that more research is needed on specific state and local policies for specific circumstances, consistent with the general principles that guide place-based policy.

• Item Type: MPRA Paper
• Language: English
• Keywords: State and local taxes; regional economic growth
• Subjects: H - Public Economics > H2 - Taxation, Subsidies, and Revenue; H - Public Economics > H7 - State and Local Government ; Intergovernmental Relations > H72 - State and Local Budget and Expenditures; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R1 - General Regional Economics > R12 - Size and Spatial Distributions of Regional Economic Activity; R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R3 - Real Estate Markets, Spatial Production Analysis, and Firm Location > R38 - Government Policy

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