| Summary: | 碩士 === 國立政治大學 === 財政學系 === 107 === The fiscal deficit and income inequality are ordeals in many countries worldwide. Since 1989, the Taiwan government has over-exploited fiscal expansion policy causing the percentage of fiscal deficit in GDP dramatically increase. In addition to fiscal deficit, the Gini coefficient keeps rising from 0.33 to about 0.35 from 2000 indicating increasing income inequality in Taiwan society. Hence, this study aims to elucidate the interaction between fiscal deficit and income inequality. The present study adopted the vector autoregression model, structural vector autoregressive model, impulse response functions, forecast error variance decomposition and causality test combined with the time series data from 1976 to 2017 in Taiwan to study the relation between fiscal deficit and income distribution.
The results showed that the fiscal deficit in Taiwan had a negative impact on income distribution. However, the income distribution did not significantly affect the fiscal deficit. There was a positive relationship between tax revenue and income distribution, and, furthermore, an increase in investment can alleviate the fiscal deficit. In addition, when economic growth, investment, tax revenue, and government spending were taken into account, the results indicated that fiscal deficit and economic growth were positively related. Nevertheless, there was a negative relationship between income distribution and tax revenue as well as fiscal deficit and government spending. Finally, there was a two-way causality relation between fiscal deficit and government spending.
|
|---|
