Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/80508
Authors: 
Asatryan, Zareh
Feld, Lars P.
Year of Publication: 
2013
Series/Report no.: 
CESifo Working Paper 4357
Abstract: 
Following the ambiguous results in the literature aimed at understanding the empirical link between fiscal federalism and economic growth, this paper revisits the question using a Bayesian Model Averaging approach. The analysis suggests that the failure to appropriately account for model uncertainty may have previously led to biased estimates. The results from a sample of 23 OECD countries over 1975-2000 indicate that after controlling for unobserved country heterogeneity, there is no robust link, neither positive, nor negative, between output growth and fiscal federalism (measured as sub-national governments' share of own source tax revenue).
Subjects: 
fiscal federalism
economic growth
Bayesian Model Averaging
JEL: 
C11
H70
O43
Document Type: 
Working Paper

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