In a decentralised tax system, the effects of tax policies enacted by one government are not confined to its own jurisdiction. First, if both the regional and the federal levels of government co-occupy the same fields of taxation, tax rate increases by one layer of government will reduce taxes...

We test the ‘yardstick competition’ hypothesis by examining the effects of property tax increases, both in a given municipality and in other neighbouring jurisdictions, on the incumbents’ vote. In order to obtain unbiased estimates of the effects of raising taxes on voting patterns, we...