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Fitness landscape and tax planning: NK model for fiscal federalism

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  • Faggini, Marisa
  • Parziale, Anna

Abstract

Economic models of Fiscal Federalism, according to different settings, are generally linear and static, offering unique and deterministic solutions starting with simplifying assumptions. This paper rises from the idea to investigate how the decision-makers, abandoning their traditional economic models and focusing, instead, the attention on innovative components of evolutionary economics, can achieve better performance results, to organize and to optimize an economic system based on Fiscal Federalism. For this purpose, Fiscal Federalism must be understood as a dense network of economic relationships between different complex adaptive and co-evolving systems, the jurisdictions, linked by strong interdependencies. A better understanding of the links between interdependence will be provided by the Kauffman’ NK-model. The relevance of the NK-model in the study of economic organizations has been detected several times in the literature. These studies, however, neglect the problem of co-evolution, which instead underpins this paper.

Suggested Citation

  • Faggini, Marisa & Parziale, Anna, 2011. "Fitness landscape and tax planning: NK model for fiscal federalism," MPRA Paper 33770, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:33770
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    File URL: https://mpra.ub.uni-muenchen.de/33770/6/MPRA_paper_33770.pdf
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    Cited by:

    1. Bruna Bruno & Marisa Faggini & Anna Parziale, 2016. "Complexity Modelling in Economics: the State of the Art," Economic Thought, World Economics Association, vol. 5(2), pages 29-43, September.

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    More about this item

    Keywords

    Evolutionary Economics; Fiscal Federalism; NK-model;
    All these keywords.

    JEL classification:

    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary; Modern Monetary Theory;
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government

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