EDRC REPORT SERIES NO. 67
                   FISCAL POLICY, INCOME DISTRIBUTION,
                               AND GROWTH
                                Sailesh K. Jha
                                November 1999
          Asian Development Bank
          P.O. Box 789
          0980 Manila
          Philippines
          ©1999 by Asian Development Bank
          November 1999
          ISSN 0117-0511
          The views expressed in this paper are those of the
          authors and do not necessarily reflect the
          views or policies of the Asian Development Bank.
                         Foreword
              The EDRC Report Series consists of research and conference papers
           prepared by or under the auspices of the Economics and Development
           Resource Center. Some of the papers are by-products of research whose
           main results are published in the Economic Staff Papers series. The EDRC
           Report Series is circulated mainly to Bank staff and is distributed outside
           the Bank only upon request.
                               JUNGSOO LEE
                               Chief Economist
                        Economics and Development Resource Center
                                                                              Contents
                     Abstract                                                                                                               vii
                            I.    Introduction                                                                                                1
                           II.    The Model                                                                                                   3
                         III.     Empirical Tests                                                                                             5
                                  A. Cross-country Regressions                                                                                5
                                  B.     Time Series Regressions                                                                              8
                          IV.     Conclusion                                                                                                 10
                     Appendixes
                           A Econometric Model                                                                                              11
                            B     Details of Data                                                                                            13
                     References                                                                                                              14