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Domestic revenue mobilization in Sub-Saharan Africa and Latin America: A comparative analysis since 1980

Gwaindepi, Abel LU (2019) In Lund Papers in Economic History. Development Economics
Abstract
Domestic revenue mobilization continues to feature on the agendas of international development agents and academic communities. There is, however, a strong focus on comparing the developed and developing countries with the aim of finding transferable lessons to the latter. Thus, most comparative studies default to comparing tax performances of developing countries with OECD averages. Interregional peer-to-peer or context-sensitive comparisons remain relatively unexplored. This paper compares the Sub-Saharan African countries (SSA) with the Latin American & Caribbean countries (LAC) since 1980. The paper focuses on tax efforts, revenue volatility and a context-sensitive analysis of the determinants of tax revenues. Using fiscal data... (More)
Domestic revenue mobilization continues to feature on the agendas of international development agents and academic communities. There is, however, a strong focus on comparing the developed and developing countries with the aim of finding transferable lessons to the latter. Thus, most comparative studies default to comparing tax performances of developing countries with OECD averages. Interregional peer-to-peer or context-sensitive comparisons remain relatively unexplored. This paper compares the Sub-Saharan African countries (SSA) with the Latin American & Caribbean countries (LAC) since 1980. The paper focuses on tax efforts, revenue volatility and a context-sensitive analysis of the determinants of tax revenues. Using fiscal data from the International Centre for Tax and Development (ICTD), the world development indicators (WDI) and other publicly available datasets, the paper finds that although the LAC countries are performing better on tax collection, they lag behind the SSA countries on tax efforts. Revenue volatility is higher on average for the SSA countries than for the LAC countries. By implementing a panel framework of 83 countries from both regions, the paper finds that the standard tax determinants behave as theoretically expected but only for the upper-middle-income countries that are relatively developed. The implication for policy is that custom-built and second-best reforms are more appropriate for the poorer countries than any ‘best practice’ from the developed regions. (Less)
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author
organization
publishing date
type
Working paper
publication status
published
subject
in
Lund Papers in Economic History. Development Economics
issue
2019:209
pages
39 pages
language
English
LU publication?
yes
id
7ec796ff-49a2-427d-b0ca-e1533f0a8535
date added to LUP
2019-11-14 09:48:00
date last changed
2019-11-14 09:48:00
@misc{7ec796ff-49a2-427d-b0ca-e1533f0a8535,
  abstract     = {Domestic revenue mobilization continues to feature on the agendas of international development agents and academic communities. There is, however, a strong focus on comparing the developed and developing countries with the aim of finding transferable lessons to the latter. Thus, most comparative studies default to comparing tax performances of developing countries with OECD averages. Interregional peer-to-peer or context-sensitive comparisons remain relatively unexplored. This paper compares the Sub-Saharan African countries (SSA) with the Latin American & Caribbean countries (LAC) since 1980. The paper focuses on tax efforts, revenue volatility and a context-sensitive analysis of the determinants of tax revenues. Using fiscal data from the International Centre for Tax and Development (ICTD), the world development indicators (WDI) and other publicly available datasets, the paper finds that although the LAC countries are performing better on tax collection, they lag behind the SSA countries on tax efforts. Revenue volatility is higher on average for the SSA countries than for the LAC countries. By implementing a panel framework of 83 countries from both regions, the paper finds that the standard tax determinants behave as theoretically expected but only for the upper-middle-income countries that are relatively developed. The implication for policy is that custom-built and second-best reforms are more appropriate for the poorer countries than any ‘best practice’ from the developed regions.},
  author       = {Gwaindepi, Abel},
  language     = {eng},
  note         = {Working Paper},
  number       = {2019:209},
  series       = {Lund Papers in Economic History. Development Economics},
  title        = {Domestic revenue mobilization in Sub-Saharan Africa and Latin America: A comparative analysis since 1980},
  url          = {https://lup.lub.lu.se/search/ws/files/71841521/LUPEH_209.pdf},
  year         = {2019},
}