Revenue-Expenditure Nexus for Southern States: Some Policy Oriented Econometric Observations

The paper examines the temporal relationship between revenues and expenditures for the four southern states during 1980 to 2005. Using an error-correction model and Granger causality test, it finds that the tax-spend hypothesis is supported by the analsysis. The spend-tax hypothesis is valid for Karnataka; fiscal synchronization hypothesis is supported for Andhra Pradesh and Kerala, while the data for Tamil Nadu failed to show any causality.

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Year of publication:	2009-04
Authors:	Chaudhuri, Kausik ; Sengupta, Bodhisattva
Institutions:	Madras School of Economics
Subject:	Revenue Expenditure \| Indian States \| Cointegration

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Series:	Working Papers.
Type of publication:	Book / Working Paper
Notes:	34 pages
Classification:	H7 - State and Local Government; Intergovernmental Relations ; C22 - Time-Series Models
Source:	RePEc - Research Papers in Economics

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