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A classic problem in public finance is the over-expenditure of local governments in expectation of a bailout from higher-level administrations. While monitoring could mitigate agency problems, it can itself be rendered ineffective if auditors are corruptible. I evaluate whether limiting...
Persistent link: https://www.econbiz.de/10013462692
between the federal and state governments in such a scheme of partial decentralization. Our model suggests that the …
Persistent link: https://www.econbiz.de/10012465415
response. In this paper, we explore the effect that competition for residents induced by fiscal decentralization has on 'waste … an additional advantage of fiscal decentralization …
Persistent link: https://www.econbiz.de/10012470537
Standard models of fiscal federalism suggest many benefits of decentralization in developing economies, and there has … been a recent push toward decentralization around the world. However, developing countries presently still have less … decentralization, particularly on the revenue side, than both developed countries today and the United States and Europe historically …
Persistent link: https://www.econbiz.de/10012459259
Using data on U.S. state and federal taxes and transfers over a quarter century, we estimate a regression model that yields the marginal effect of any shift of market income share from one quintile to another on the entire post tax, post-transfer income distribution. We identify exogenous income...
Persistent link: https://www.econbiz.de/10014544770
The U.S. Supreme Court decision in the landmark 2018 Wayfair case greatly improved state governments' ability to enforce collection of sales taxes on a destination basis. This has reduced state tax competition with an essentially-untaxed internet, but has brought traditional cross-border...
Persistent link: https://www.econbiz.de/10014247994
This paper analyzes whether the propensity to secede by subnational regions responds mostly to differences in income per capita or to distinct identities. We explore this question in a quantitative political economy model where people's willingness to finance a public good depends on their...
Persistent link: https://www.econbiz.de/10013388783
We estimate whether federal aid for state and local governments played a role in advancing population testing for COVID-19 and the administration of vaccines. To overcome biases that can result from the endogeneity of federal aid allocations, we use an instrumental-variables estimator reliant on...
Persistent link: https://www.econbiz.de/10013334424
This paper overviews theoretical and empirical studies of political borders from an economic perspective. It reviews theories of the number and size of nations focused on the trade-off between economies of scale in public-good provision and heterogeneity of preferences over public policies as...
Persistent link: https://www.econbiz.de/10013477293
We present an economic rationale for countries resorting to foreign influence to export their ideology to other nations. Our model incorporates two fundamental elements: redistribution of the tax burden between capital owners and workers, and international capital mobility. The model highlights...
Persistent link: https://www.econbiz.de/10014322786