Budget Stabilization Fund: Structural Features of the Enabling Legislation and Balance Levels

27 Pages Posted: 14 Sep 2004

See all articles by Yilin Hou

Yilin Hou

Maxwell School, Syracuse University

Abstract

This article examines what leads to high balances of the budget stabilization fund (BSF) to make it a countercyclical fiscal tool. Checking state BSF laws, this article classifies BSF structural features into purposes, funding sources, balance caps, and use approval procedures. Using panel data (1979-1999) and controlling for related variables, this article tests the features' effects on BSF levels over the sample period and different phases of the economy to identify specific effects of the features in boom and lean years. The article also forwards policy recommendations for state governments to consider in designing or revising their BSF legislation.

Suggested Citation

Hou, Yilin, Budget Stabilization Fund: Structural Features of the Enabling Legislation and Balance Levels. Available at SSRN: https://ssrn.com/abstract=591608

Yilin Hou (Contact Author)

Maxwell School, Syracuse University ( email )

426 Eggers Hall
Syracuse, NY 13244-1020
United States
315-443-3114 (Phone)

HOME PAGE: http://www.maxwell.syr.edu/pa/cpr/Hou,_Yilin/

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