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Two Games of Interjurisdictional Competition When Local Governments Provide Industrial Public Goods

  • Thorsten Bayindir-Upmann
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    In this paper we investigate two different games of interjurisdictional competition when local governments provide public goods that benefit industry. Governments play a game either in tax rates on mobile industrial capital or in public expenditures. Although the literature suggests that competition in public expenditures is ‘more competitive’ than in tax rates, this is not necessarily true in the case of industrial public goods. Moreover, in the presence of industrial public goods interjurisdictional competition may also lead to overprovision of public services. Copyright Kluwer Academic Publishers 1998

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    File URL: http://hdl.handle.net/10.1023/A:1008694605822
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    Article provided by Springer in its journal International Tax and Public Finance.

    Volume (Year): 5 (1998)
    Issue (Month): 4 (October)
    Pages: 471-487

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    Handle: RePEc:kap:itaxpf:v:5:y:1998:i:4:p:471-487
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    1. Wilson, John Douglas, 1991. "Tax competition with interregional differences in factor endowments," Regional Science and Urban Economics, Elsevier, vol. 21(3), pages 423-451, November.
    2. KEEN, Michael & MARCHAND, Maurice, 1996. "Fiscal Competition and the Pattern of Public Spending," CORE Discussion Papers 1996001, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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    6. MINTZ, Jack & TULKENS, Henry, . "Commodity tax competition between member states of a federation: equilibrium and efficiency," CORE Discussion Papers RP -693, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    7. Wilson, John D., 1985. "Optimal property taxation in the presence of interregional capital mobility," Journal of Urban Economics, Elsevier, vol. 18(1), pages 73-89, July.
    8. Burbidge, John B. & Myers, Gordon M., 1994. "Population mobility and capital tax competition," Regional Science and Urban Economics, Elsevier, vol. 24(4), pages 441-459, August.
    9. Wilson, John D., 1986. "A theory of interregional tax competition," Journal of Urban Economics, Elsevier, vol. 19(3), pages 296-315, May.
    10. Jensen, Richard & Toma, Eugenia Froedge, 1991. "Debt in a model of tax competition," Regional Science and Urban Economics, Elsevier, vol. 21(3), pages 371-392, November.
    11. Bucovetsky, Sam & Wilson, John Douglas, 1991. "Tax competition with two tax instruments," Regional Science and Urban Economics, Elsevier, vol. 21(3), pages 333-350, November.
    12. Bucovetsky, S., 1991. "Asymmetric tax competition," Journal of Urban Economics, Elsevier, vol. 30(2), pages 167-181, September.
    13. Gramlich, Edward M, 1994. "Infrastructure Investment: A Review Essay," Journal of Economic Literature, American Economic Association, vol. 32(3), pages 1176-96, September.
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