The influence of tax and expenditure policies on economic growth in The Netherlands: An empirical analysis

Ed Westerhout, J. van Sinderen

Research output: Contribution to journalArticleScientificpeer-review

Abstract

This paper explores the influence of government policies in explaining output, employment and investment in The Netherlands during the period 1966–1989. The paper develops an empirical macroeconomic model estimated with annual data relating to the period 1958–1989. It finds that restrictive fiscal policies in the eighties have had adverse short-term effects on output and employment. Furthermore, the drop in the rate of increase in tax and social security contribution rates in this period has boosted output, employment and investment. However, the shift in public expenditure from investment to consumption has exerted a negative impact on these variables, largely offsetting the positive impact of the tax policies.
Original languageEnglish
Pages (from-to)43-61
JournalDe Economist
Volume142
Issue number1
DOIs
Publication statusPublished - 1994
Externally publishedYes

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Tax
Economic growth
Expenditure
Empirical analysis
The Netherlands
Government policy
Tax policy
Public expenditure
Contribution rate
Social security contributions
Macroeconomic models
Fiscal policy

Cite this

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abstract = "This paper explores the influence of government policies in explaining output, employment and investment in The Netherlands during the period 1966–1989. The paper develops an empirical macroeconomic model estimated with annual data relating to the period 1958–1989. It finds that restrictive fiscal policies in the eighties have had adverse short-term effects on output and employment. Furthermore, the drop in the rate of increase in tax and social security contribution rates in this period has boosted output, employment and investment. However, the shift in public expenditure from investment to consumption has exerted a negative impact on these variables, largely offsetting the positive impact of the tax policies.",
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The influence of tax and expenditure policies on economic growth in The Netherlands: An empirical analysis. / Westerhout, Ed; van Sinderen, J.

In: De Economist, Vol. 142, No. 1, 1994, p. 43-61.

Research output: Contribution to journalArticleScientificpeer-review

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AB - This paper explores the influence of government policies in explaining output, employment and investment in The Netherlands during the period 1966–1989. The paper develops an empirical macroeconomic model estimated with annual data relating to the period 1958–1989. It finds that restrictive fiscal policies in the eighties have had adverse short-term effects on output and employment. Furthermore, the drop in the rate of increase in tax and social security contribution rates in this period has boosted output, employment and investment. However, the shift in public expenditure from investment to consumption has exerted a negative impact on these variables, largely offsetting the positive impact of the tax policies.

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