Final published version
Research output: Contribution to Journal/Magazine › Journal article › peer-review
Research output: Contribution to Journal/Magazine › Journal article › peer-review
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TY - JOUR
T1 - Intergovernmental transfers and procyclical public spending
AU - Abbott, Andrew James
AU - Jones, Philip
PY - 2012/6/1
Y1 - 2012/6/1
N2 - This paper tests the predictions that (i) sub-central government expenditures are procyclical and (ii) sub-central government expenditures are likely to be more procyclical than central government spending. The predictions are based on the importance of ‘voracity effects’ and on the proposition that they are systematically more pervasive if spending is financed by intergovernmental transfers. Evidence from 23 OECD countries between 1995 and 2006 indicates that sub-central government spending is more procyclical than central government expenditure.
AB - This paper tests the predictions that (i) sub-central government expenditures are procyclical and (ii) sub-central government expenditures are likely to be more procyclical than central government spending. The predictions are based on the importance of ‘voracity effects’ and on the proposition that they are systematically more pervasive if spending is financed by intergovernmental transfers. Evidence from 23 OECD countries between 1995 and 2006 indicates that sub-central government spending is more procyclical than central government expenditure.
KW - Sub-central government spending
KW - Intergovernmental transfers
KW - Voracity effects
KW - Business Cycles
U2 - 10.1016/j.econlet.2011.12.104
DO - 10.1016/j.econlet.2011.12.104
M3 - Journal article
VL - 115
SP - 447
EP - 451
JO - Economics Letters
JF - Economics Letters
SN - 0165-1765
IS - 3
ER -