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Reform During Crisis: The Transformation of California's Fiscal System During the Great Depression

Author

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  • Hartley, James E.
  • Sheffrin, Steven M.
  • Vasche, J. David

Abstract

In the midst of the Great Depression, California engaged in a massive restructuring of its tax system, reducing reliance on the property tax and introducing sales and income taxes. Our analysis suggests that this restructuring, which included a voter referendum, was primarily driven by a desire to change the mix rather than the level of taxation. Nonetheless, by introducing new taxes that had a higher revenue elasticity than the existing taxes, California created a revenue system that allowed the rapid growth of spending to continue.

Suggested Citation

  • Hartley, James E. & Sheffrin, Steven M. & Vasche, J. David, 1996. "Reform During Crisis: The Transformation of California's Fiscal System During the Great Depression," The Journal of Economic History, Cambridge University Press, vol. 56(3), pages 657-678, September.
  • Handle: RePEc:cup:jechis:v:56:y:1996:i:03:p:657-678_01
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    Cited by:

    1. Steven M. Sheffrin, 2008. "Fairness and Market Value Property Taxation," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper0822, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    2. Daniele Coen-Pirani & Michael Wooley, 2018. "Fiscal Centralization: Theory and Evidence from the Great Depression," American Economic Journal: Economic Policy, American Economic Association, vol. 10(2), pages 39-61, May.

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