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Fiscal Policy and Long-Run Growth
Author:
Mr. Vito Tanzi
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Mr. Howell H Zee
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Series:
IMF Working Papers
Volume/Issue:
Volume 1996: Issue 119
Language:
English
Publication Date:
01 Oct 1996
DOI:
https://doi.org/10.5089/9781451854121.001
ISBN:
9781451854121
ISSN:
1018-5941
Pages:
36
Keywords:
WP; income; public expenditure; capital; private sector; growth theory; physical capital; growth effect; private sector productivity; public finance; fiscal policy variable; rate of change; transmission mechanism; unforeseen public expenditure; income equality; income taxation; externality effect of public expenditure; Human capital; Income distribution; Income inequality
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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This paper discusses in a systematic and comprehensive way the existing literature on the relationship between the growth of countries’ economies and various public finance instruments, such as tax policy, expenditure policy, and overall budgetary policy, from the perspectives of allocative efficiency, macroeconomic stability, and income distribution. It reviews both the conceptual linkages between each of the instruments and growth and the empirical evidence on such relationships. It broadly concludes that fiscal policy could play a fundamental role in affecting the long-run growth performance of countries.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund
Volume 1996: Issue 119