In the twenty-first century, taxation has become a major object of contestation in international political and economic relations and has given rise to attempts to establish global fiscal governance. In this way, the international community is trying to harness the power of multinational...

This paper investigates incentive effects of fiscal equalization on local tax rates. I propose three refinements to current empirical estimations of these incentive effects. I show that local policy makers may conceive of changes in equalization transfers as stemming from discrete rather than...