On the politicization of intergovernmental fiscal relations in Germany after unification
AbstractA recent decision of the German Constitutional Court requires political decision makers to revise the system of intergovernmental transfers in order to limit free bargaining among state and federal government officials. The present paper provides empirical support for the thesis that political discretion has become increasingly important in the transfer negotiations after Unification. We attempt to show why political influences gained weight relative to economic considerations in the determination of net gains. This politicization of the fiscal transfer system appears to be a consequence of the inability of policy makers to agree on a fundamental reform in the early 1990's.
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Bibliographic InfoPaper provided by Department of Economics, Johannes Kepler University Linz, Austria in its series Economics working papers with number 2001-05.
Date of creation: Mar 2001
Date of revision:
Find related papers by JEL classification:
- D7 - Microeconomics - - Analysis of Collective Decision-Making
- H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
This paper has been announced in the following NEP Reports:
- NEP-ALL-2002-07-08 (All new papers)
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- Lars P. Feld & Christoph A. Schaltegger, 2004.
"Voters as a hard budget constraint: On the determination of intergovernmental grants,"
Marburg Working Papers on Economics
200418, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
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- Lars P. Feld & Christoph A. Schaltegger, 2005. "Voters as a Hard Budget Constraint: On the Determination of Intergovernmental Grants," CREMA Working Paper Series 2005-21, Center for Research in Economics, Management and the Arts (CREMA).
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