Year: 2026
Type: article
Abstract: For over a century now, one of the central debates of economic policy has been around fiscal policy. Taxation and government spending have been a feature of most political campaigns, with one (more vocal) side claiming that taxation chokes economic growth and benefits special interests, while leaving a legacy of debt. Another side sees taxation as a necessary tool for creating equal opportunity and ensuring adequate investment in collective public goods, including human capital. Using newly constructed datasets that we will make available, we take a fresh look at fiscal policy on the global level and across U.S. states, measuring its effects on growth and equity. We utilize a new technique, functional data analysis (FDA). We find limited evidence for both the conservative and progressive arguments around fiscal policy in the short term. Rather, the data suggest persistent fiscal patterns across space and time that reflect long-term social value choices around the tradeoffs of growth vs. public investment and equity.
DOI: 10.3390/ijfs14020030
Authors: Anil Hira, Tim Swartz, Jiguo Cao
Institution: Simon Fraser University
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
SDG: Reduced inequalities
Open Access status: gold
Estimated APC paid: $2,172
OpenAlex ID: W7127111426