Political Institutions, State Building, and Tax Capacity : Crossing the Tipping Point

Journal Issue

Volume/Issue:: 2016/233
Series:: IMF Working Papers
Author(s):: Vitor Gaspar, Laura Jaramillo, and Philippe Wingender
Publisher:: INTERNATIONAL MONETARY FUND
Published Date:: December 2016
DOI:: http://dx.doi.org/10.5089/9781475558142.001
ISBN:: 9781475558142
ISSN:: 1018-5941
Page:: 33

An empirical finding by Gaspar, Jaramillo and Wingender (2016) shows that once countries cross a tax-to-GDP threshold of around 12¾ percent, real GDP per capita increases sharply and in a sustained manner over the following decade. In this paper, we attempt via four case studies-Spain, China, Colombia, and Nigeria-to illustrate that the improvements in tax capacity have been part of a deeper process of state capacity building. We discuss the political conditions that supported tax capacity building, highlighting three important political ingredients: constitutive institutions, inclusive politics and credible leadership.

IMF Working Paper: Political Institutions, State Building, and Tax Capacity: Crossing the Tipping Point

Political Institutions, State Building, and Tax Capacity: Crossing the Tipping Point

Article

Political Institutions, State Building, and Tax Capacity

Author(s):: Vitor Gaspar, Laura Jaramillo, and Philippe Wingender
Published Date:: December 2016

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Political Institutions, State Building, and Tax Capacity : Crossing the Tipping Point

Political Institutions, State Building, and Tax Capacity

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