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Redistribution within and across the Regions of a Federation

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Author Info
John B. Burbidge
Gordon M. Myers

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Abstract

The authors reconsider the literature on redistribution within a federation with mobile agents. They conclude that redistribution is a function best assigned to the national government; local governments with diverse preferences for redistribution distort individual migration decisions. The authors also examine the fiscal externality literature, which has made an efficiency argument for interregional transfers. They show that, if local governments have the same preferences for redistribution, the Nash equilibrium is efficient. If preferences are diverse, the authors show that nationally imposed interregional transfers do not address the source of the inefficiency. Nevertheless, interregional transfers are shown to be a part of decentralized behavior.

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Publisher Info
Article provided by Canadian Economics Association in its journal Canadian Journal of Economics.

Volume (Year): 27 (1994)
Issue (Month): 3 (August)
Pages: 620-36
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Handle: RePEc:cje:issued:v:27:y:1994:i:3:p:620-36

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  1. Gordon M. Myers & Yorgos Y. Papageorgiou, 2000. "Towards a Better System for Immigration Control," Discussion Papers dp00-17, Department of Economics, Simon Fraser University, revised Sep 2000. [Downloadable!]
  2. Seija Parviainen, 1998. "Redistribution and Risk Sharing in EMU," Discussion Papers 159, Government Institute for Economic Research Finland (VATT). [Downloadable!]
  3. Kjetil Bjorvatn, 1998. "Taxation and Migration in a Federal System," International Tax and Public Finance, Springer, vol. 5(3), pages 345-355, July. [Downloadable!] (restricted)
  4. Charles Figuieres & Jean Hindriks & Gareth Myles, 2004. "Revenue Sharing versus Expenditure Sharing in a Federal System," Asia-Pacific Financial Markets, Springer, vol. 11(2), pages 155-174, March. [Downloadable!] (restricted)
    Other versions:
  5. Joan Rosselló, 2003. "Regional redistribution and growth," Investigaciones Economicas, Fundación SEPI, vol. 27(2), pages 369-392, May. [Downloadable!]
  6. Jeffery Petchey & Perry Shapiro, 2003. "Policy Competition, Factor Mobility and Multiple Policy Instruments: Existence and Non-Existence of Equilibrium," University of California at Santa Barbara, Economics Working Paper Series wp3-03, Department of Economics, UC Santa Barbara. [Downloadable!]
  7. Bagchi, Amaresh & Chakraborty, Pinaki, 2004. "Towards a rational system of centre-state revenue transfers in India: An exploration," Working Papers 04/16, National Institute of Public Finance and Policy. [Downloadable!]
  8. Arman Mansoorian, 1999. "Risk Sharing in a Federation with Population Mobility and Long Horizons," Working Papers 1999_03, York University, Department of Economics. [Downloadable!]
  9. Arman Mansoorian, 1996. "Risk Sharing and Redistribution in a Federal System with Population Mobility," Working Papers 1996_03, York University, Department of Economics. [Downloadable!]
  10. Motohiro Sato, 2000. "Fiscal Externalities and Efficient Transfers in a Federation," International Tax and Public Finance, Springer, vol. 7(2), pages 119-139, March. [Downloadable!] (restricted)
  11. Andreas Pfingsten & Andreas Wagener, 1997. "Centralized vs. Decentralized Redistribution: A Case for Interregional Transfer Mechanisms," International Tax and Public Finance, Springer, vol. 4(4), pages 429-451, November. [Downloadable!] (restricted)
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