Intergovernmental transfers and procyclical public spending

Andrew Abbott, Philip Jones

Research output: Contribution to journalArticlepeer-review

6 Citations (Scopus)

Abstract

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.
Original languageEnglish
Pages (from-to)447-451
Number of pages5
JournalEconomics Letters
Volume115
Issue number3
DOIs
Publication statusPublished - Jun 2012

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