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A Regional Model of Growth Oriented Fiscal Policy: An Application to Georgia and Its Competitor States

Author

Listed:
  • Jeffrey Condon

    (Georgia State University)

  • Andrew Feltenstein

    (Georgia State University)

  • Florenz Plassman

    (Binhamton University)

  • Mark Rider

    (Georgia State University)

  • David L. Sjoquist

    (Georgia State University)

Abstract

A number of U.S. states are considering tax reforms that would significantly reduce or eliminate income taxes and recover the lost revenue by increasing its sales taxes. To gauge the economic effects of such reforms, we construct a multi-regional, dynamic, open economy, general equilibrium (CGE) model. Our model is an advancement over existing regional CGE models used to simulate the impact of state tax reforms in the U.S. context. We simulate the impact of a variety of tax reforms and find that Georgia’s economy benefits but at the expense of the five comparison states we include.

Suggested Citation

  • Jeffrey Condon & Andrew Feltenstein & Florenz Plassman & Mark Rider & David L. Sjoquist, 2014. "A Regional Model of Growth Oriented Fiscal Policy: An Application to Georgia and Its Competitor States," The Review of Regional Studies, Southern Regional Science Association, vol. 44(2), pages 177-209, Summer.
    • Handle: RePEc:rre:publsh:v44:y:2014:i:2:p:177-209
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    References listed on IDEAS

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    More about this item

    Keywords

    dynamic simulation models; fundamental tax reform;

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue

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