Property Tax Limits, Balanced Budget Rules, and Line-Item Vetoes: A Long-Run View

Forthcoming, Eastern Economic Journal

36 Pages Posted: 18 Feb 2016

See all articles by John A. Dove

John A. Dove

Troy University - Manuel H. Johnson Center for Political Economy

Date Written: January 2016

Abstract

This paper explores the early development of three important fiscal institutions faced by U.S. state governments: property tax limits (PTLs), balanced budget rules (BBRs), and the gubernatorial line-item veto (LIV). Specifically, this study attempts to provide historical context for their development and an empirical investigation of their long-run effect on state finances (running from 1830 to 1920). Results, which are robust to a number of specifications, suggest that early PTLs decreased both revenues and expenditures, BBRs had a larger effect on revenues rather than expenditures, while the LIV had a somewhat limited effect on both revenues and expenditures.

Keywords: Tax and Expenditure Limits, Balanced Budget Rules, Line-Item Veto

JEL Classification: D78, H71, N91

Suggested Citation

Dove, John A., Property Tax Limits, Balanced Budget Rules, and Line-Item Vetoes: A Long-Run View (January 2016). Forthcoming, Eastern Economic Journal. Available at SSRN: https://ssrn.com/abstract=2716722

John A. Dove (Contact Author)

Troy University - Manuel H. Johnson Center for Political Economy ( email )

Bibb Graves Hall
Troy, AL 36082
United States

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