Minimizing the Harm of State Fiscal Volatility

Authors

David Gamage, University of Missouri School of Law
Jeremy Bearer-Friend

Document Type

Article

Publication Date

2010

Abstract

This report’s primary concern is how U.S. state governments should respond to the fiscal volatility created by their balanced budget constraints. Applying the principles of risk allocation theory to this recurring problem, we conclude that states should primarily adjust the rates of broad-based taxes as their economies cycle, rather than fluctuating public spending.

Recommended Citation

David Gamage and Jeremy Bearer-Friend, Minimizing the Harm of State Fiscal Volatility, 57 State Tax Notes 633 (2010).
Available at: https://scholarship.law.missouri.edu/facpubs/1169