2012
DOI: 10.1111/j.1468-2257.2011.00577.x
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The Impact of State and Local Tax and Expenditure Limitations on State Economic Growth

Abstract: Employing a unique index of Tax and Expenditure Limitation (TEL) restrictiveness, we estimate a family of economic growth models using a panel of the 50 U.S. states for the period 1969 to 2005. Our central goal is to assess the relationship between TEL restrictiveness and economic growth. Results suggest that stronger TELs imposed on state governments have a dampening effect on state economic growth and TELs imposed on local governments have a weak negative impact on growth. The results do not support the argu… Show more

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Cited by 33 publications
(36 citation statements)
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“…This index does not specifically measure the level of the TEL (i.e., how much taxing and spending is allowed), but rather how difficult it is for state policymakers to bypass the state's adopted limit. Given that most studies look at TELs in a dichotomous nature (either they are present in a state or not), this index is by far the most comprehensive way to examine TELs and has been gaining momentum in the literature (Marlowe ; Kioko ; Cummins ; Deller, Stallman and Amiel ).…”
Section: Introductionmentioning
confidence: 99%
“…This index does not specifically measure the level of the TEL (i.e., how much taxing and spending is allowed), but rather how difficult it is for state policymakers to bypass the state's adopted limit. Given that most studies look at TELs in a dichotomous nature (either they are present in a state or not), this index is by far the most comprehensive way to examine TELs and has been gaining momentum in the literature (Marlowe ; Kioko ; Cummins ; Deller, Stallman and Amiel ).…”
Section: Introductionmentioning
confidence: 99%
“…Results suggest no positive relationship between TELs and economic performance but found some evidence that more restrictive TELs actually hinder economic performance. Deller et al (2012) found that more restrictive TELs have a dampening effect on economic growth. Taking the research a step farther, Amiel, Deller, and Stallman (2012) used a panel of annual data for the 50 states from 1990 to 2010, with a variable parameter specification coupled with a dynamic generalized method of moments (GMM) panel estimator.…”
Section: State-level Researchmentioning
confidence: 99%
“…Initially, TELs were adopted as a form of government protest in the early 1800s, though they began to emerge in earnest during the tax revolt of the 1970s and 1980s with the adoption of property tax limits, such as California's Proposition 13 and Massachusetts' Proposition 2 1/2 (Atchison 1992;Deller, Stallmann, and Amiel 2012;Sun 2014). The string of recessions between 1969 and 1982, combined with the fact that tax codes were not indexed for inflation, left many households struggling financially (Domitrovic 2014).…”
Section: The Four Preemption Epochsmentioning
confidence: 99%