Tax Potential vs. Tax Effort: A Cross-Country Analysis of Armenia's Stubbornly Low Tax Collection

Davoodi, Hamid; Grigorian, David

doi:10.2139/ssrn.984611

Cited by 12 publications

(15 citation statements)

References 23 publications

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“…Following the earlier approach, more recent work by Gupta (2007), Davoodi and Grigorian (2007), and others supports the view that per capita income, the share of agriculture GDP, and the degree of trade openness are main determinants of tax ratios. These studies have also incorporated foreign aid flows and institutional factors (especially corruption) as explanatory variables.…”

Section: Introductionmentioning

confidence: 94%

“…Intuitively, foreign aid represents a relatively costless windfall that could become a substitute for domestic revenue (Bräutigam, 2000), while poor quality of institutions may induce tax evasion and (resource) rent-seeking (Tanzi and Davoodi, 1997;Collier, 2005). While the effect of foreign aid is not consistently negative in empirical research (Gupta and others, 2003;Drummond, Srivastava, and Oliveira, 2012), the adverse effect of corruption on revenue is more widely supported empirically (Davoodi and Grigorian, 2007;Bird, Martinez-Vazquez, and Torgler, 2008;Bornhorst, Gupta, and Thornton, 2009;and Drummond, Srivastava, and Oliveira, 2012). This paper focuses explicitly on whether countries with higher resource revenue tend to receive lower taxation revenue from other forms of income and consumption expenditure.…”

Section: Introductionmentioning

confidence: 99%

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Resource Dependence and Fiscal Effort in Sub-Saharan Africa

Thomas

Trevino²

2013

IMF Working Papers

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Section: Introductionmentioning

confidence: 94%

Section: Introductionmentioning

confidence: 99%

Resource Dependence and Fiscal Effort in Sub-Saharan Africa

Thomas

Trevino²

2013

IMF Working Papers

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“…Therefore, he believed that the reformation tax systems of African countries with viable macroeconomic environment would eventually increase the size of their tax receipts which can promote their revenue generation and economic growth. Hence, weak quality institutions encourage tax evasion and rent-seeking, while corruption adversely affect revenue [87][88][89].…”

Section: Review Of Related Literaturementioning

confidence: 99%

External debt and economic growth in Sub-Saharan Africa: Does governance matter?

et al. 2022

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This study empirically examined the impact of external debt on economic growth. Also, the interactions of governance, external debt and external debt volatility were further investigated with emphasize on the interective effect of governance as proxied by Kaufmann, D., (2007) quality governance measures such as; government effectiveness, political stability, voice and accountability, regulatory quality and corruption control on economic growth. The study utilized annual time series data, focusing on thirty selected Sub-Saharan African (SSA) countries for the period 1997 to 2020. The Dynamic System Generalised Method of Moments estimation technique was adopted while controlling for conventional sources of economic growth. Empirical findings from the study reveal that external debt and external debt volatility have a negative and significant impact on economic growth in SSA. Furthermore, the interaction of governance indicators, external debt and its volatility, had a positive impact on economic growth in SSA. This study recommends that SSA government should endeavor to avoid excessive external debt to promote the regions’ capacity to invest in her financial prospects, and to circumvent the danger of repayment of loans using her small income. The SSA governments should also improve the quality of governance by ensuring political stability, minimising corruption, implementing sound policies and regulations that can permit and promote economic growth through the development of the private sector. The governments must ensure that every borrowed debt is properly supervised and utilised for its purposes to spur economic growth. More so, the Guidotti-Greenspan rule of Reserve adequacy should be applied to keep excess borrowings in check.

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“…Regression-based Fiscal Capacity Approach (RFCA) after the Regressionbased Cost Approach (RCA) used in the literature with reference to expenditure needs (Blöchliger et al 2007). 7 As far as we know, an econometric approach has so far been adopted only by Alfirman (2003), Davoodi and Grigorian (2007), and Gupta (2007). In these three papers, however, the regression analysis is used to measure the tax potential of governments, which is given by the ability of raising revenue exerting the maximum fiscal effort.…”

Section: Regression-based Fiscal Capacity Approach (Rfca)mentioning

confidence: 99%

“…In order to measure HFI we suggest a new method for evaluating SCGs fiscal capacity based on regression analysis. Alfirman (2003), Davoodi and Grigorian (2007), and Alfirman (2007) adopt a similar methodology, but they use regression analysis in order to measure the tax potential of governments, which includes both the fiscal capacity and the tax effort. In our analysis, instead, regression analysis is employed to evaluate distinctively fiscal capacity and tax effort: the former depends only on tax bases and standard tax rates, excluding all other economic and institutional variables.…”

Section: Introductionmentioning

confidence: 99%

Measuring horizontal fiscal imbalance: the case of Italian municipalities

Liddo

Longobardi

Porcelli

2016

Local Government Studies

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In the literature on fiscal federalism, vertical fiscal imbalances have been widely studied, while the theme of horizontal fiscal imbalances and inequality between local governments' fiscal capacities is still less explored. This paper contributes to fill the gap. A new method to compute fiscal capacities based on regression analysis is proposed, which can overcome some of the drawbacks of traditional methods such the representative tax system. This new approach is then employed to evaluate the fiscal capacities of Italian municipalities over the period 2002-2010. Finally two global measures of the horizontal fiscal imbalance are then used to evaluate the equity implication of a major policy change occurred in 2008 in Italian municipal finance.

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Tax Potential vs. Tax Effort: A Cross-Country Analysis of Armenia's Stubbornly Low Tax Collection

Cited by 12 publications

References 23 publications

Resource Dependence and Fiscal Effort in Sub-Saharan Africa

Resource Dependence and Fiscal Effort in Sub-Saharan Africa

External debt and economic growth in Sub-Saharan Africa: Does governance matter?

Measuring horizontal fiscal imbalance: the case of Italian municipalities

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