This study focuses on the impacts state shared revenues has on local government finances. Specifically we examine what is referred to in the academic literature as the "flypaper effect." Using a simple model of local fiscal behavior Bradford and Oates (1971a, 1971b) predict that aids to local...

Predictive models of government spending behavior based solely on the median voter theory have demonstrated limited utility, particularly when intergovernmental grants are involved. Since the 1970s, research on the impact of intergovernmental grants and aids on recipient governments has...