Is there any rationale to the Brazilian fiscal policy?

Rocha, Fabiana

doi:10.1590/s0034-71402001000300001

Cited by 4 publications

(3 citation statements)

References 8 publications

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“…Their results suggest that Pakistan's fiscal policy is optimal and consistent with tax smoothing behaviour, but the stock of public liabilities is on an unsustainable trajectory. Rocha (2001) investigates whether Brazil smoothed tax for the period 1970-1994. The results contradict the tax smoothing hypothesis.…”

Section: Theorotical Framework and Literature Reviewmentioning

confidence: 99%

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Fiscal Policy and Optimal Taxation in Sierra Leone: Testing for Tax Smoothing Hypothesis

Bonzu¹

2022

IJEF

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This paper empirically investigate whether the budget imbalances in Sierra Leone over the review period is consistent with optimal tax policy. The procedure involves testing if tax smoothing hypothesis hold for Sierra Leone. In this regard, three different empirical approaches were performed. Firstly, I examine the random walk property of the tax rate. The null hypothesis of non-stationarity of tax rate could not be rejected, which implies the tax rate follows random walk. Second, I examined whether changes in tax rate is predictable by regressing changes in tax rate by its own lagged values. The result shows that tax rate is unpredictable, as changes in tax cannot be determined by its lagged values. Finally, a VAR model was employed to examine whether tax rate can be predicted by its own lagged values together with changes in the government spending rate and the growth rate of real GDP. The results indicate that all the variables employed were found not be significant is predicating the tax rate. Overall, all the empirical estimations support the existence of tax smoothing over the sample period and that the budget inbalances over the review period is consistent with optimal tax policy.

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Section: Theorotical Framework and Literature Reviewmentioning

confidence: 99%

“…The results contradict the tax smoothing hypothesis. Rocha (2001) suggests that the performance of public debt may be explained from the standpoint of political economy rather than the idea of tax smoothing.…”

Section: Theorotical Framework and Literature Reviewmentioning

confidence: 99%

Fiscal Policy and Optimal Taxation in Sierra Leone: Testing for Tax Smoothing Hypothesis

Bonzu¹

2022

IJEF

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“…A segunda linha utiliza-se de um modelo de vetores auto-regressivos, VAR. Três artigos seguem esta linha: Huang e Lin (1993) estudam o caso dos Estados Unidos, Ghosh (1995) testa a hipótese para os casos do Canadá e Estados Unidos e Rocha (2001) analisa o caso do Brasil. Ghosh (1995), em particular, tem como foco a trajetória ótima do superávit orçamentário, não a trajetória observada da carga tributária.…”

Section: Introductionunclassified

Déficits, gastos do governo e a não-estabilidade da carga tributária no caso do Estado do Rio Grande do Sul

Marques¹

2007

Econ. Apl.

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A hipótese de estabilização da carga tributária (tax-smoothing hypothesis) implica: 1) a carga tributária ótima segue um passeio aleatório puro; 2) um superávit orçamentário igual ao valor presente esperado de variações nos gastos do governo. No presente artigo, são realizados testes de passeio aleatório da carga tributária para o período 1970-2002 e usa-se um modelo de vetores auto-regressivos para o período 1970-1997 no caso das finanças públicas do Estado do Rio Grande do Sul. Os testes rejeitam a hipótese de estabilização da carga tributária para o caso em estudo em ambos os períodos. Isto é, as evidências indicam que o governo estadual não se comportou como um tax-smoother. Palavras-chave: tax-smoothing hypothesis, vetores auto-regressivos, Rio Grande do Sul. abstractThe tax-smoothing hypothesis implies that: 1) the optimal tax rate follows a pure random walk; 2) a budget surplus equal to the expected present value of changes in government expenditures. In this paper random walk tests of tax rate are performed for the period 1970-2002 and use a vector autoregression model to the period 1970-1997 in the case of the state of Rio Grande do Sul public finances. The tests reject the tax-smoothing hypothesis for the case in study for both periods. That is, the evidences show that the state government has not behaved as tax-smoother.

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Determinação dos superávits do governo central brasileiro: influência da política monetária na ótica de regressões de limiar

Schettini

2014

Estud. Econ.

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ResumoEste artigo estuda a política fiscal no Brasil levando em consideração a influência da política monetária. A taxa de inflação do IPCA e os gastos com juros como razão do PIB representam variáveis de estado na determinação da sequência de superávits primários pelo Tesouro. Dessa forma, o modelo empírico de reação da política fiscal foi estimado com o auxílio de regressões de limiar. Em face dos resultados encontrados, não surpreende a tolerância do governo com superávits menores. Vale notar que cortes na taxa SELIC possuem efeitos mistos, pois menores despesas de juros possibilitam reduzir os superávits, porém mais inflação torna a política fiscal persistente. O inverso acontece na situação em que o Banco Central reduz a liquidez da economia. Palavras-Chavesuperávits primários, dívida pública líquida, taxa de inflação, gastos com juros e regressões de limiar AbstractThis paper studies the fiscal policy in Brazil accounting for the influence of monetary policy. The CPI inflation rate and the interest outlays as a ratio of GDP represent state variables in the determination of the sequence of primary surpluses by the Treasury. Hence, the empirical model of the fiscal reaction function was estimated using threshold regressions. In the light of the empirical evidence, it is no surprise the tolerance of the government with lower surpluses. It is noteworthy that reductions in the SELIC rate have mixed effects, since the lower burden of interest expenses allow for lower surpluses, while more inflation makes the fiscal policy persistent. The inverse occurs when the Central Bank reduces the liquidity in the economy.

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Is there any rationale to the Brazilian fiscal policy?

Cited by 4 publications

References 8 publications

Fiscal Policy and Optimal Taxation in Sierra Leone: Testing for Tax Smoothing Hypothesis

Fiscal Policy and Optimal Taxation in Sierra Leone: Testing for Tax Smoothing Hypothesis

Déficits, gastos do governo e a não-estabilidade da carga tributária no caso do Estado do Rio Grande do Sul

Determinação dos superávits do governo central brasileiro: influência da política monetária na ótica de regressões de limiar

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