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Spatial Interdependence of Local Public Expenditures: Selected Evidence from the Czech Republic

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Abstract

Local expenditures in neighbouring municipalities can be spatially interdependent due to spillovers, cooperation effects, competition effects or mimicking. In this paper, we aim to test the spatial interdependence of local public expenditures using data on 205 Czech municipalities. We found positive spatial interdependence in expenditures on housing and culture and negative spatial interdependence for expenditures on industry and infrastructure and environmental protection. Additionally, we observed that political characteristics affect the size of spending; left-wing parties tend to increase expenditures on culture and decrease expenditures on industry and infrastructure; and higher party fragmentation decreases overall capital expenditures and expenditures on housing.

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Bibliographic Info

Article provided by Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies in its journal AUCO Czech Economic Review.

Volume (Year): 3 (2009)
Issue (Month): 1 (March)
Pages: 007-025

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Handle: RePEc:fau:aucocz:au2009_007

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Keywords: Spillovers; fiscal competition; local public finance;

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Cited by:
  1. Lars Håkonsen & Knut Løyland, 2013. "Local government allocation of cultural services," ACEI Working Paper Series AWP-06-2013, the Association for Cultural Economics International, revised Oct 2013.
  2. Bernardino Benito & Francisco Bastida & Cristina Vicente, 2013. "Municipal elections and cultural expenditure," Journal of Cultural Economics, Springer, vol. 37(1), pages 3-32, February.

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