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Efectos de las formulas para las transferencias inter- gubernamentales en el tamaño del gobierno federal

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  • Raul Alberto Ponce Rodriguez

    () (Universidad Autonoma de Ciudad Juarez)

Abstract

In this paper, we study the role of inter-regional externalities of public goods, equity and electoral competition in the determination of the budget of the central government that funds the provision of local public goods. Our model predicts that the budget for local public goods is proportional to a weighted average of the nation’s income and inversely proportional to a weighted average of the nation’s taxes; that the electoral competition induces policy makers to select a budget for the central government that is Pareto efficient. This result is different to the prediction of other models of political economy, such as the median voter and the Leviathan models, in which fiscal policy is Pareto inefficient. Finally, in this article, we provide hypotheses that can be verified empirically by identifying configurations of the distribution of income, population and the determination of the formula for inter-governmental transfers that can induce a higher (lower) level of spending from the central government to finance local public goods.

Suggested Citation

  • Raul Alberto Ponce Rodriguez, 2013. "Efectos de las formulas para las transferencias inter- gubernamentales en el tamaño del gobierno federal," EconoQuantum, Revista de Economia y Negocios, Universidad de Guadalajara, Centro Universitario de Ciencias Economico Administrativas, Departamento de Metodos Cuantitativos y Maestria en Economia., vol. 10(1), pages 37-58, Enero-Jun.
  • Handle: RePEc:qua:journl:v:10:y:2013:i:1:p:37-58
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    More about this item

    Keywords

    Transferencias inter-gubernamentales; el tamaño del gobierno; la competencia electoral.;

    JEL classification:

    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H50 - Public Economics - - National Government Expenditures and Related Policies - - - General

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