Great Recession and Fiscal Squeeze at U.S. Subnational Government Level
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Summary:
The paper discusses the fiscal impact of the Great Recession of 2007-08 on state and local governments in the United States. It documents the sharp decline in tax revenue and discusses how states responded to close the budget gaps in order to obey the balanced budget provisions. It highligts the procyclical nature of this policy response, provides a brief comparison with subnational policy stances in other advanced economies, and discusses some options for making subnational fiscal policy less procyclical within the framework of current rules.
Series:
Working Paper No. 12/184
Subject:
Economic recession Fiscal policy Government expenditures Investment Stabilization measures Tax collection Tax policy Tax revenues United States
English
Publication Date:
July 1, 2012
ISBN/ISSN:
9781475505320/1018-5941
Stock No:
WPIEA2012184
Format:
Paper
Pages:
40
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