On the Causal Relationship between Government Expenditure and Tax Revenue in Pakistan
doi: https://doi.org/10.35536/lje.2004.v9.2.a6
M. Haider Hussain
Abstract
This paper applies the technique of Granger Causality to determine the relationship between total government expenditures and total tax revenue using annual revised estimates. The analysis discovers a firm unidirectional effect from expenditure to revenue suggesting the preference of controlling the spending decisions to reduce the tax revenue-expenditure deficit.
Keywords
Pakistan, Granger Causality, estimates, tax revenue-expenditure deficit