The main goal of this paper is to warn practitioners of the danger of neglecting outliers in regression analysis, in particular, good leverage points (i.e. points lying close to the regression hyperplane but outlying in the x-dimension). While the types of outliers which do influence regression...

From the literature on decentralization, it appears that the fiscal vertical imbalance (i.e. the dependence of sub-national governments on national government revenues to support their expenditures) is somehow inherent to multi-level governments. Using a stylized model we show that this leads to...