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Testing yardstick competition through a vote-function: evidence from the Walloon municipalities


  • Laurent Van Malderen
  • Marcel Gerard


This paper aims at testing yardstick competition among the local jurisdictions of the Walloon Region (Southern part of Belgium) by directly testing its seminal hypothesis: yardstick voting. Actually the theory states that local incumbents are mimicking themselves because they fear punishment for implementing higher tax rates than in the neighbouring jurisdictions. Our research question is whether voters punish their incumbents for higher tax rates?We estimate different specifications of a vote function. None of them supports the yardstick voting hypothesis. One can thus exclude yardstick voting as a statistically supported behaviour of taxpayers. And we can exclude yardstick competition as a source of tax interactions in the Walloon region if yardstick voting is a testable hypothesis of yardstick competition. Indeed, if the tax rates of the neighbouring jurisdictions do not influence voters’ choices, incumbents do not have to fear an electoral punishment and then mimicking each other is meaningless.

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  • Laurent Van Malderen & Marcel Gerard, 2013. "Testing yardstick competition through a vote-function: evidence from the Walloon municipalities," Economics and Business Letters, Oviedo University Press, vol. 2(4), pages 206-214.
  • Handle: RePEc:ove:journl:aid:10125

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    1. Besley, Timothy & Smart, Michael, 2007. "Fiscal restraints and voter welfare," Journal of Public Economics, Elsevier, vol. 91(3-4), pages 755-773, April.
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    5. Eric Dubois & Sonia Paty, 2010. "Yardstick competition: which neighbours matter?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 44(3), pages 433-452, June.
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    8. Massimo Bordignon & Floriana Cerniglia & Federico Revelli, 2002. "In Search for Yardstick Competition: Property Tax Rates and Electoral Behavior in Italian Cities," CESifo Working Paper Series 644, CESifo Group Munich.
    9. Federico Revelli, 2005. "On Spatial Public Finance Empirics," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 12(4), pages 475-492, August.
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    12. Jan Vermeir & Bruno Heyndels, 2006. "Tax policy and yardstick voting in Flemish municipal elections," Applied Economics, Taylor & Francis Journals, vol. 38(19), pages 2285-2298.
    13. Revelli, Federico, 2002. "Local taxes, national politics and spatial interactions in English district election results," European Journal of Political Economy, Elsevier, vol. 18(2), pages 281-299, June.
    14. Marcel Gérard & Laurent van Malderen, 2012. "Tax Interaction among Walloon Municipalities: Is there Room for Yardstick Competition, Intellectual Trend and Partisan Monopoly Effect?," CESifo Working Paper Series 4025, CESifo Group Munich.
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