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Using data on federal highway grants from the Department of Transportation's Federal High- way Administration, this paper investigates several questions regarding the political economy of highway funding. We investigate the period 1994 - 2008 and examine whether political alignment and political...
Persistent link: https://www.econbiz.de/10012948327
State borders create a discontinuous tax treatment of retail sales. In a Nash game, local tax rates will be higher on … the low-state-tax side of a border. Local taxes will decrease from the nearest high-tax border and increase from the low-tax … border. Using driving time from state borders and all local sales tax rates, local tax rates on the low-tax side of the …
Persistent link: https://www.econbiz.de/10013023921
regional and federal public goods and the benevolent central government implements interregional earmarked and income transfers … interregional income and earmarked transfers to equate consumption of private and regional public goods across regions. Such … leadership is efficient if the center adopts redistributive interregional income and earmarked policies and there is a common …
Persistent link: https://www.econbiz.de/10012981293
We propose a theory of tax centralization and inter governmental grants in politico-economic equilibrium. The cost of … the local level. This renders the degree of tax centralization and the tax burden determinate even if none of the …
Persistent link: https://www.econbiz.de/10012981295
redistributive effect of these mechanisms of about 20%. This means that long-run income differentials of 1 Swiss Franc between … cantons translate into differences of long-run disposable income after taxes and transfers of about 80 cents. The combined … contemporary stabilization effect with respect to short-term income fluctuations amounts to less than 10%, which is a small effect …
Persistent link: https://www.econbiz.de/10012921275
The vast majority of federations lack exit clauses. Existing theoretical explanations of this stylized fact focus on issues of credible commitment, signaling, and the risk of strategic exploitation. However, such accounts are unable to explain the adoption by the European Union (EU) of Article...
Persistent link: https://www.econbiz.de/10012910625
positive, however, capital tax rates are inefficiently low in the decentralized equilibrium …
Persistent link: https://www.econbiz.de/10013136697
) with a less transparent one (a surcharge on the personal income tax). Theoretical analysis suggests this should give …A 1999 reform allowed Italian Mayors to partially substitute a more accountable source of tax revenue (the property tax …
Persistent link: https://www.econbiz.de/10013141506
We study the efficient allocation of spending and taxation authority in a federation in which federal politicians are exposed to electoral uncertainty. We show that centralization may, but need not, result in a loss of electoral accountability. We identify an important asymmetry between positive...
Persistent link: https://www.econbiz.de/10013144284
Switzerland is often viewed as a federalist curiosity and a unique form of direct democracy. But this view does not provide a proper understanding of the country. A theory of Switzerland is necessary. A consideration of the initial, exogenous geographical situation of Swiss territory provides a...
Persistent link: https://www.econbiz.de/10013117983