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Different Forms of Outside Aid: a Collective-Choice Model for Predicting Effects On Local Educational Expenditure


  • Cyril F. Chang

    (State University of New York at Fredonia)


This article presents a method for predicting the effects of different forms of outside aid on local educational expenditure. The predictive power of the suggested method is demonstrated with an experiment using district-level data collected for the State of Virginia. The paper also tests the recent theoretical results of David Bradford and Wallace Oates who have argued (1) that in a median-voter setting matching grants are more stimulative than lump sum grants of the same amount, and (2) that under certain conditions lump sum grants are equivalent in their effects to a reduction in federal and state personal taxes. The test results are favorable.

Suggested Citation

  • Cyril F. Chang, 1981. "Different Forms of Outside Aid: a Collective-Choice Model for Predicting Effects On Local Educational Expenditure," Public Finance Review, , vol. 9(3), pages 321-341, July.
  • Handle: RePEc:sae:pubfin:v:9:y:1981:i:3:p:321-341

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    Cited by:

    1. Fisher, Ronald C. & Papke, Leslie E., 2000. "Local Government Responses to Education Grants," National Tax Journal, National Tax Association;National Tax Journal, vol. 53(1), pages 153-168, March.
    2. Rhee, Se-Koo, 1996. "The impact of intergovernmental grants-in-aid on public school expenditure under the segregated school system," ISU General Staff Papers 1996010108000012396, Iowa State University, Department of Economics.

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