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Panel-Data Analysis of Capital Account Liberalization and Tax Revenue

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  • Bojan Ilievski

Abstract

The main motive behind financial repression is fiscal. The government wishes to promote development but lacks the resources to do so. In fact, financial repression is an instrument of government revenue management. This paper examines the impact of capital account liberalization on government's tax revenue. I test the hypothesis empirically, using panel data on 149 countries over the period 1970-2017. Historically, I find that the positive impact of capital account liberalization on tax revenue is predominant in countries where the depth of the banking sector is greater. Â JEL classification numbers: O11, H2, G2.

Suggested Citation

  • Bojan Ilievski, 2023. "Panel-Data Analysis of Capital Account Liberalization and Tax Revenue," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 13(6), pages 1-7.
    • Handle: RePEc:spt:apfiba:v:13:y:2023:i:6:f:13_6_7
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Tax; Capital account Liberalization; Bank credit; Panel data.;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • G2 - Financial Economics - - Financial Institutions and Services

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