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Competition for Private Capital and Central Grants: The Case of Japanese Industrial Parks

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  • Shun-ichiro Bessho

    ()
    (Department of Economics, Hitotsubashi University)

  • Kimiko Terai

    ()
    (Hosei University)

Abstract

We construct a simple model of fiscal competition taking `rent-seeking' behavior of local governments into account and estimate a policy reaction function based on the model. We consider the scale of public input as each local government's policy tool. Local autonomies' method of seeking central grants often takes the form of personnel exchange with central government. Our estimation of the policy reaction function suggests that such personnel exchange has an effect on the development of industrial parks.

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Bibliographic Info

Paper provided by University of California-Irvine, Department of Economics in its series Working Papers with number 080909.

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Length: 35 pages
Date of creation: Sep 2008
Date of revision:
Handle: RePEc:irv:wpaper:080909

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Keywords: Business area development; Policy competition; Rent-seeking; Spatial model;

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Cited by:
  1. Ivo Bischoff & Frédéric Blaeschke, 2013. "Incentives and Influence Activities in the Public Sector: the Trade-off in Performance Budgeting and Conditional Grants," MAGKS Papers on Economics 201320, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  2. Ivo Bischoff & Frédéric Blaeschke, 2012. "Window-Dressing and Lobbying in Performance-Budgeting: a Model for the Public Sector," MAGKS Papers on Economics 201212, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).

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