Local taxes in Buenos Aires City: A CGE approach
AbstractThe aim of this paper is to analyze the spillover effects of national and local tax policies using a static bi-regional general equilibrium model for the Buenos Aires City (BAC) and the rest of Argentina. The BAC represents 7% of the population of the country, but 29% of its GDP. We analyze the reciprocal impact of fiscal policies on welfare of private agents and the spillover effects on the performance of the public sector of both regions. As expected, the model shows that national fiscal policies do have relevant effects on the activity level of the city and on the welfare of its inhabitants. However, more unexpectedly, it also shows that fiscal decisions at the level of the city have a significant impact on the rest of the country. The results show that: (i) an increase in BAC local taxes produce a decline in the welfare of households and in the activity levels, in both regions; (ii) an increase in national value added tax decreases the regional GDP in both regions, but in different proportions, and increases the regional unemployment rate. The results differ depending on the type of tax (sales or property). Production elasticities and the rule of indexation of wages are key factors that affect the quantitative and qualitative results.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 40029.
Date of creation: 30 Apr 2012
Date of revision:
Fiscal Federalism; Computable general equilibrium; Regional spillover effects;
Find related papers by JEL classification:
- H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
- C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
- D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-07-23 (All new papers)
- NEP-CMP-2012-07-23 (Computational Economics)
- NEP-GEO-2012-07-23 (Economic Geography)
- NEP-PBE-2012-07-23 (Public Economics)
- NEP-PUB-2012-07-23 (Public Finance)
- NEP-URE-2012-07-23 (Urban & Real Estate Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Mastronardi, Leonardo Javier & Romero, Carlos Adrián, 2012.
"Estimación de matrices de insumo producto regionales mediante métodos indirectos. Una aplicación para la ciudad de Buenos Aires
[A non-survey estimation for regional input-output tables. An appl," MPRA Paper 37006, University Library of Munich, Germany.
- M. Alejandro Cardenete & Ferran Sancho, 2002. "An Applied General Equilibrium Model to Assess the Impact of National Tax Changes on a Regional Economy," Economic Working Papers at Centro de Estudios Andaluces E2002/13, Centro de Estudios Andaluces.
- Chisari, Omar Osvaldo & Mastronardi, Leonardo Javier & Romero, Carlos Adrián, 2012. "Building an input-output Model for Buenos Aires City," MPRA Paper 40028, University Library of Munich, Germany.
- Manuel Alejandro Cardenete Flores, 2006.
"Federalismo fiscal a partir de un modelo de equilibrio general aplicado: Andalucía VS. España,"
Economic Working Papers at Centro de Estudios Andaluces
E2006/22, Centro de Estudios Andaluces.
- Manuel Alejandro Cardenete Flores, 2009. "Federalismo fiscal a partir de un modelo de equilibrio general aplicado: Andalucía vs. España," Revista de Estudios Regionales, Universidades Públicas de Andalucía, vol. 4, pages 359-366.
- Robinson, Sherman & Cattaneo, Andrea & El-Said, Moataz, 1998. "Estimating a social accounting matrix using cross entropy methods:," TMD discussion papers 33, International Food Policy Research Institute (IFPRI).
- Diao, Xinshen & Diaz-Bonilla, Eugenio & Robinson, Sherman & Orden, David, 2005. "Tell me where it hurts, an' I'll tell you who to call," MTID discussion papers 84, International Food Policy Research Institute (IFPRI).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.