Several recent studies suggest that equalizing transfers in a federal system may distort the tax policy decisions of states. We study this issue for the German federal fiscal system. In a simple theoretical model, we first identify a substitution and an income effect of equalizing transfers. Our...

Following years of job cuts in the civil service recent statistical data point to a turnaround in parallel with the improved budgetary position. However, there is still a substantial need to raise employment over the coming years. According to this study there is currently a staff deficit of at...