Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/73054
Authors: 
Hayo, Bernd
Uhl, Matthias
Year of Publication: 
2012
Series/Report no.: 
Joint Discussion Paper Series in Economics 17-2012
Abstract: 
This paper studies regional output asymmetries following U.S. federal tax shocks. We estimate a vector autoregressive model for each U.S. state, utilizing the exogenous tax shock series recently proposed by Romer and Romer (2010) and find considerable variations: estimated output multipliers lie between -0.2 in Utah and -3.3 in Hawaii. Statistically, the difference between state and national output effect is significant in about half the U.S. states. Analyzing the determinants of differences in the magnitude of regional tax multipliers suggests that industry composition of output and sociodemographic characteristics help explain the observed asymmetry across U.S. states in the transmission of federal tax policy.
Subjects: 
Fiscal Policy
Tax Policy
Narrative Approach
U.S. States
Regional Effects
Asymmetries in Fiscal Policy Transmission
JEL: 
E32
E62
H20
R10
R11
Document Type: 
Working Paper

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