Measures of fiscal insurance to Canadian provinces

Date
2011
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Abstract
In a federation, a cyclically-sensitive central government budget shifts tax revenues and spending programs benefits from states experiencing economic expansions to those enduring contractions. In this way, central governments make citizens better off by using fiscal policy to pool income risk across economically-diverse regions. Correlations of Canadian provincial GDPs confirm that provincial economies experience diverse business cycles. Interprovincial price adjustments and population migrations respond to business cycles; however, non-discretionary fiscal policy remains the only viable policy tool for achieving stabilization. I identify automatically stabilizing budget categories and the size of fiscal insurance they provide. Notably, provinces with relatively high incomes enjoy the benefits of fiscal insurance yielded by the federal budget more so than other provinces. Generating larger amounts of federal fiscal insurance, requires an increase in the sensitivity to those budget components behaving most effectively as both automatic stabilizers and fiscal insurance providers. This thesis identifies those budget components.
Description
Bibliography: p. 101-102.
Some pages are in colour.
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Citation
Gres, M. (2011). Measures of fiscal insurance to Canadian provinces (Master's thesis, University of Calgary, Calgary, Canada). Retrieved from https://prism.ucalgary.ca. doi:10.11575/PRISM/3941
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