This paper discusses the concepts of vertical fiscal imbalance (the fiscal gap) and horizontal fiscal imbalance (equalization) and uses several statistics to measure these concepts for the eight developed federal countries: Australia, Austria, Belgium, Canada, Germany, Spain, Switzerland, and the United States. Although the periods covered and the detail provided vary from country to country because of limitations in data availability, the overall coverage in this paper seems more complete and comparable than in previous studies. The paper also outlines briefly the types of intergovernmental fiscal transfers used to deal with fiscal imbalances in the eight countries under consideration. Although this account is necessarily highly condensed, given the complexity of transfer systems in most countries, the frequency with which changes are made, and the difficulty of obtaining complete information, it is nonetheless broadly accurate.
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Volume (Year): 22 (2004) Issue (Month): 1 (February) Pages: 77-102 Download reference. The following formats are available: HTML
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Robin Boadway & Jean-Francois Tremblay, 2005.
"A Theory of Vertical Fiscal Imbalance,"
Working Papers
2006-04, University of Kentucky, Institute for Federalism and Intergovernmental Relations.
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