Efectos de las formulas para las transferencias inter- gubernamentales en el tamaño del gobierno federal
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.
Volume (Year): 10 (2013)
Issue (Month): 1 (Enero-Junio)
|Contact details of provider:|| Postal: 636 6270|
Phone: 636 6270
Fax: 633 6975
Web page: http://econoquantum.cucea.udg.mx
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:qua:journl:v:10:y:2013:i:1:p:37-58. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sandra Ivett Portugal Padilla)
If references are entirely missing, you can add them using this form.