The Relationship between Revenue and Expenditure in the ASEAN Countries

East Asia, 31, 3, 203-221, ISSN: 1096-6838

19 Pages Posted: 9 Sep 2014 Last revised: 16 Oct 2015

See all articles by Cosimo Magazzino

Cosimo Magazzino

University of Rome III; Royal Economic Society; Italian Economic Association

Date Written: 2014

Abstract

The aim of this study is to assess the relationship between revenue and expenditure in the ASEAN countries. Using annual data for the period between 1980 and 2012 in ten member states, a long-run relationship between government expenditure and revenue emerges, both in ASEAN-6 and ASEAN-10 countries. Granger causality analysis shows mixed results, even though for five ASEAN countries the predominance of "tax-and-spend" hypothesis exists, given that government revenue drives the expenditure. Moreover, mixture models seem to produce homogeneous groups, considering the socio-economic structure, welfare state, and historical aspects. Finally, convergence measures show interesting results, confirming the sample’s heterogeneity.

Keywords: ASEAN, South-East Asia, Economic growth, Government expenditure, Government revenue, Panel

JEL Classification: B22, C33, E62, F33

Suggested Citation

Magazzino, Cosimo, The Relationship between Revenue and Expenditure in the ASEAN Countries (2014). East Asia, 31, 3, 203-221, ISSN: 1096-6838, Available at SSRN: https://ssrn.com/abstract=2493672

Cosimo Magazzino (Contact Author)

University of Rome III ( email )

Via Ostiense 139
Rome, RM 00154
Italy

HOME PAGE: http://scienzepolitiche.uniroma3.it/cmagazzino/

Royal Economic Society ( email )

London
United Kingdom

Italian Economic Association ( email )

Piazzale Martelli, 8
Ancona, AN 60121
Italy

HOME PAGE: http://www.siecon.org/online/en/

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