Arbeitspapier
Federal tax-transfer policy and intergovernmental pre-commitment
Federal and state governments often differ in the capacity to pre-commit to expenditure and tax policy. Whether the implied sequence of public decisions has any efficiency implications is the subject of this paper. We resort to a setting which contrary to most of the literature does not exhibit a perfect tax-base overlap. We show that a federal government's pre-commitment capacity is welfare-improving. Efficiency, however, does not improve over all decision margins. The welfare-increasing policy entails a more distorted level of public consumption. Moreover, welfare may also improve if local governments are able to pre-commit towards the upper level. The rationale is that although federal transfers are formally unconditional they nevertheless entail a tax-price effect; thereby potentially counteracting incentives to engage in a race to the bottom in fiscal competition among local governments.
- Sprache
-
Englisch
- Erschienen in
-
Series: CESifo Working Paper ; No. 2054
- Klassifikation
-
Wirtschaft
State and Local Taxation, Subsidies, and Revenue
Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
Structure and Scope of Government: General
- Thema
-
Finanzföderalismus
Finanzausgleich
Steuerpolitik
Steuerwettbewerb
Agency Theory
Theorie
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Koethenbuerger, Marko
- Ereignis
-
Veröffentlichung
- (wer)
-
Center for Economic Studies and ifo Institute (CESifo)
- (wo)
-
Munich
- (wann)
-
2007
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:44 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Koethenbuerger, Marko
- Center for Economic Studies and ifo Institute (CESifo)
Entstanden
- 2007