Government Role and the Efficiency of Policy Instruments

22 Pages Posted: 15 Feb 2006

See all articles by Vito Tanzi

Vito Tanzi

International Monetary Fund (IMF); National Bureau of Economic Research (NBER)

Date Written: October 1995


Comparisons about the role of the government in an economy are usually made by reference to the share of tax revenue or of public expenditure in gross domestic product. However, governments often use other tools for pursuing their objectives. The paper discusses these other tools, shows the extent to which they can replace the traditional fiscal instruments, and assesses their quantitative importance. Various highly speculative hypotheses are advanced about the role of these other tools in countries at different levels of development.

JEL Classification: H1, H2, H5

Suggested Citation

Tanzi, Vito, Government Role and the Efficiency of Policy Instruments (October 1995). IMF Working Paper No. 95/100, Available at SSRN:

Vito Tanzi (Contact Author)

International Monetary Fund (IMF) ( email )

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Tax Policy Division Fiscal Affairs Department
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United States

National Bureau of Economic Research (NBER)

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