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Impact of Federal Transfers over Regional Authorities Behavior

Author

Listed:
  • Vittoria Idrisova

    (Gaidar Institute for Economic Policy)

  • Lev Freinkman

    (Gaidar Institute for Economic Policy)

Abstract

The objective of the work is the analysis of the impact of grants, allocated from the central government budget for the expenditures of regional budgets, and the “sticker” effect, which means a traditional disproportion between the federal transfers and the amount of regional expenditure. In this work, the econometric models are provided for the estimates of the “sticker” effect scale in regional terms. The results of the presented work can be used for further enhancement of intergovernmental fiscal relations in Russia.

Suggested Citation

  • Vittoria Idrisova & Lev Freinkman, 2010. "Impact of Federal Transfers over Regional Authorities Behavior," Research Paper Series, Gaidar Institute for Economic Policy, issue 137P.
  • Handle: RePEc:gai:rpaper:83
    as

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    File URL: http://www.iep.ru/files/RePEc/gai/rpaper/83Idrisova.pdf
    File Function: Revised version, 2012
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    References listed on IDEAS

    as
    1. Roemer, John E & Silvestre, Joaquim, 2002. " The "Flypaper Effect" Is Not an Anomaly," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 4(1), pages 1-17.
    2. Edward M. Gramlich & Harvy Galper, 1973. "State and Local Fiscal Behavior and Federal Grant Policy," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 4(1), pages 15-66.
    3. Hamilton, Bruce W., 1983. "The flypaper effect and other anomalies," Journal of Public Economics, Elsevier, vol. 22(3), pages 347-361, December.
    4. Philip J. Grossman, 1990. "The Impact of Federal and State Grants on Local Government Spending: a Test of the Fiscal Illusion Hypothesis," Public Finance Review, , vol. 18(3), pages 313-327, July.
    5. Rubinfeld, Daniel L., 1987. "The economics of the local public sector," Handbook of Public Economics,in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 2, chapter 11, pages 571-645 Elsevier.
    6. Bailey, Stephen J & Connolly, Stephen, 1998. "The Flypaper Effect: Identifying Areas for Further Research," Public Choice, Springer, vol. 95(3-4), pages 335-361, June.
    7. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416-416.
    8. Megdal, Sharon Bernstein, 1987. "The Flypaper Effect Revisited: An Econometric Explanation," The Review of Economics and Statistics, MIT Press, vol. 69(2), pages 347-351, May.
    9. Worthington, Andrew C & Dollery, Brian E, 1999. "Fiscal Illusion and the Australian Local Government Grants Process: How Sticky Is the Flypaper Effect?," Public Choice, Springer, vol. 99(1-2), pages 1-13, April.
    10. Zampelli, Ernest M, 1986. "Resource Fungibility, the Flypaper Effect, and the Expenditure Impact of Grants-in-Aid," The Review of Economics and Statistics, MIT Press, vol. 68(1), pages 33-40, February.
    11. Gamkhar, Shama & Oates, Wallace E., 1996. "Asymmetries in the Response to Increases and Decreases in Intergovernmental Grants: Some Empirical Findings," National Tax Journal, National Tax Association, vol. 49(4), pages 501-512, December.
    12. Becker, Elizabeth, 1996. "The Illusion of Fiscal Illusion: Unsticking the Flypaper Effect," Public Choice, Springer, vol. 86(1-2), pages 85-102, January.
    13. Bradford, David F & Oates, Wallace E, 1971. "Towards a Predictive Theory of Intergovernmental Grants," American Economic Review, American Economic Association, vol. 61(2), pages 440-448, May.
    14. Case, Anne C. & Rosen, Harvey S. & Hines, James Jr., 1993. "Budget spillovers and fiscal policy interdependence : Evidence from the states," Journal of Public Economics, Elsevier, vol. 52(3), pages 285-307, October.
    15. Brian Knight, 2002. "Endogenous Federal Grants and Crowd-out of State Government Spending: Theory and Evidence from the Federal Highway Aid Program," American Economic Review, American Economic Association, vol. 92(1), pages 71-92, March.
    16. Logan, Robert R, 1986. "Fiscal Illusion and the Grantor Government," Journal of Political Economy, University of Chicago Press, vol. 94(6), pages 1304-1318, December.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Federal Transfers; Regional Authorities;

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism

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