CEU Electronic Theses and Dissertations, 2017
| Author | Beatrice, Hananiah |
|---|---|
| Title | Tax Smoothing Hypothesis: A Case of Pakistan |
| Summary | Tax Smoothing Hypothesis (TSH) proposes that a government seeks to minimize tax distortions and does not vary tax rates directly with changes in expenditures. Instead expenditures are financed by debt and a constant tax stream is maintained. This thesis explores if TSH holds for Pakistan and finds evidence of Tax Smoothing from 1976-2014 as tax rate series exhibits unit root properties, and the lagged values of tax rates do not influence contemporaneous tax rates changes. Moreover, tax rates are not affected by changes in government expenditures and real GDP growth rate. These results are consistent with the properties of the TSH and explain fiscal imbalances in Pakistan. |
| Supervisor | Istvan Konya |
| Department | Economics MA |
| Full text | https://www.etd.ceu.edu/2017/beatrice_hananiah.pdf |
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