The Impact of Fiscal Policy Variables on Output Growth
January 1, 1998
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Summary
This paper surveys the theoretical and empirical literature on the relationship between taxation and public expenditure and economic growth. Particular attention is paid to the effect of taxation and government expenditure on the supply and productivity of labor and physical capital. Studies suggest that well-targeted government expenditures on health, education, and infrastructure should have a positive impact on growth. By contrast, the impact of taxation on the supplies of labor and capital, and on output growth, is more muted.
Subject: Expenditure, Income, Labor, Labor supply, National accounts, Production, Production growth
Keywords: Africa, capital goods, capital investment, closed economy, cost of capital, East Africa, economic growth, Fiscal Policy, Government Expenditure, Growth, Income, income effect, income elasticity, income tax, infrastructure investment, interest rate, Labor supply, Middle East, North Africa, per capita income, personal income, production function, Production growth, rate of return, returns to scale, Sub-Saharan Africa, substitution effect, Taxation, WP
Pages:
74
Volume:
1998
DOI:
Issue:
001
Series:
Working Paper No. 1998/001
Stock No:
WPIEA0011998
ISBN:
9781451841602
ISSN:
1018-5941
