La contrainte de budget des collectivités locales françaises est-elle relâchée ?

Fiscal relief of local governments by the central authorities has become a subject of major concern in the political economy of multi-level governments. Generally studied in federations, fiscally irresponsible behaviors are endogenous to the system of financial relations amongst levels of government. This system may allow local governments to strategically constrain the central government to bail them out. The present contribution provides a case study of a unitary but decentralized state, namely France. It shows that the usual debt channel of the soft budget constraint is not relevant here. However, the ill designed system of local taxation has been resulting over the years in an increasing burden on local taxpayers which is partially relieved by the central government. Local governments may strategically anticipate such relieves with “first mover” increases in their tax pressure.