Redistributive grants schemes, such as fiscal equalization, are a common characteristic of local public finance in several countries. However, large and small jurisdictions are treated differently by the respective fiscal equalization schemes that often tend to favour larger jurisdictions. This...

This paper uses a simple model of fiscal competition in taxes and public inputs among local jurisdictions to analyze the incentive effects of fiscal equalization transfers. We find that a budget-compensated increase in the contribution rate to a system of fiscal equalization not only induces...

This paper uses a simple model of fiscal competition in taxes and public inputs among local jurisdictions to analyze the incentive effects of fiscal equalization transfers. We find that a budget-compensated increase in the contribution rate to a system of fiscal equalization not only induces...

Die vorliegende Arbeit wurde von Christian Kelders in der Zeit seiner Tätigkeit als Wissenschaftlicher Mitarbeit des Center for Economic Studies (CES) erstellt und im September 2005 abgeschlossen. Gegenstand der Arbeit sind die Besteuerungsanreize im System der deutschen Kommunalfinanzen....