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Is Good Governance the Driving Force Behind Raising Tax Revenues? A Panel Data Analysis

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Bibliographic Details
Title: Is Good Governance the Driving Force Behind Raising Tax Revenues? A Panel Data Analysis
Authors: Simge Bereketoğlu, Mehmet Avcı
Source: Volume: 9, Issue: 131-43
Bingöl Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi
Bingol University Journal of Economics and Administrative Sciences
Publisher Information: Bingol Universitesi, 2025.
Publication Year: 2025
Subject Terms: Kamu Yönetimi, Public Administration, Tax Revenues, Good Governance, Panel Data Analysis, System GMM, Vergi Gelirleri, İyi Yönetişim, Panel Veri Analizi, Sistem GMM, Public Finance, Kamu Maliyesi
Description: The ability of governments to effectively perform their essential functions primarily depends on their access to adequate revenue sources. This makes the level of tax revenues a critical issue. Then, what determines the level of tax revenue? Responses to this question are typically approached from economic and fiscal perspectives. However, the growing recognition of the impact of institutions on societal welfare today necessitates updating these responses. Institutions can be seen not only as determinants of economic performance but also as factors influencing tax revenues. This study empirically investigates the impact of good governance, a significant aspect of institutional economics, on tax revenues. The central hypothesis is that good governance will enhance tax revenues. In this context, the effect of good governance and its components on tax revenues for 25 countries during the period 1996-2019 was examined using dynamic panel data analysis with the system GMM estimator. As expected, the findings confirm that good governance and its components boost tax revenues. Therefore, countries' efforts to enhance good governance serve as a driving force for increasing tax revenues.
Document Type: Article
File Description: application/pdf
ISSN: 2651-3234
DOI: 10.33399/biibfad.1553353
Access URL: https://dergipark.org.tr/tr/pub/biibfad/issue/92858/1553353
Accession Number: edsair.doi.dedup.....fcbb2e7cf49e4fc874419b081cb15ec2
Database: OpenAIRE
Description
Abstract:The ability of governments to effectively perform their essential functions primarily depends on their access to adequate revenue sources. This makes the level of tax revenues a critical issue. Then, what determines the level of tax revenue? Responses to this question are typically approached from economic and fiscal perspectives. However, the growing recognition of the impact of institutions on societal welfare today necessitates updating these responses. Institutions can be seen not only as determinants of economic performance but also as factors influencing tax revenues. This study empirically investigates the impact of good governance, a significant aspect of institutional economics, on tax revenues. The central hypothesis is that good governance will enhance tax revenues. In this context, the effect of good governance and its components on tax revenues for 25 countries during the period 1996-2019 was examined using dynamic panel data analysis with the system GMM estimator. As expected, the findings confirm that good governance and its components boost tax revenues. Therefore, countries' efforts to enhance good governance serve as a driving force for increasing tax revenues.
ISSN:26513234
DOI:10.33399/biibfad.1553353