This paper develops new measures of environmental costs and local revenue capacity as the basis for a new municipal aid formula in Massachusetts. On the cost side, unlike previous studies, we quantify the effects on local non-school spending of characteristics related to uncontrollable costs. On...

This paper discusses the current state of fiscal relations between the federal, state and local governments in the United States and suggests directions for improvement. The significant degree of fiscal autonomy of the states and, to a lesser extent, of local governments has had several...

In federal countries, such as the U.S., the fiscal authority consists not of one, but many governments, with state governments accounting for a sizable share of expenditures. We analyze how state partisanship of politicians affects state fiscal policy and quantify the possible macroeconomic...

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...

In economic unions the fiscal authority consists not of one, but many governments. We analyze whether partisanship of state-level politicians affects federal policies, such as fiscal stimulus in the U.S. Using data from close elections, we find partisan differences in the marginal...

Over the past two decades, litigation has exploded over state corporate tax shelters. In the typical transaction, taxpayers devise corporate structures so as to shift income (most commonly income from intangible assets) to low or no tax jurisdictions. Much of the literature on these transactions...

Proponents of the Patient Protection and Affordable Care Act of 2010 (ACA) set forth two primary goals: (1) to constrain health care costs and (2) to expand health insurance coverage. In its June 28, 2012 decision upholding the constitutionality of the ACA, the U.S. Supreme Court effectively...

Empirical research in public economics, including our own, often uses variation in state and local taxes as an empirical laboratory to estimate causal relationships. A key concern is that other taxes might change at the same time. To assess this concern, we develop a dataset of state (1977-2022)...

We consider the problem of testing for a structural break in the spatial lag parameter in a panel model (spatial autoregressive). We propose a likelihood ratio test of the null hypothesis of no break against the alternative hypothesis of a single break. The limiting distribution of the test is...

This paper estimates the aggregate productivity effects of Marshallian externalities generated by foreign direct investments (FDI) in the US. In contrast to earlier work, this paper puts special emphasis on controlling for Marshallian externalities and other intra- and inter-regional spillovers...