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Does Fiscal Cooperation Increase Local Tax Rates in Urban Areas?

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  • Sylvie Charlot
  • Sonia Paty
  • Virginie Piguet

Abstract

C harlot S., P aty S. and P iguet V. Does fiscal cooperation increase local tax rates in urban areas?, Regional Studies . The main purpose of this paper is to assess the effects of fiscal cooperation on local taxation in a decentralized country using experience in French urban municipalities. A tax-setting model for local business tax is estimated, using spatial and panel econometric techniques, for the period 1993-2003. Controlling for population size, it is found that fiscal cooperation is likely to reduce tax competition and, as a consequence, to increase local business tax rates.

Suggested Citation

  • Sylvie Charlot & Sonia Paty & Virginie Piguet, 2015. "Does Fiscal Cooperation Increase Local Tax Rates in Urban Areas?," Regional Studies, Taylor & Francis Journals, vol. 49(10), pages 1706-1721, October.
  • Handle: RePEc:taf:regstd:v:49:y:2015:i:10:p:1706-1721
    DOI: 10.1080/00343404.2013.878798
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    References listed on IDEAS

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    Cited by:

    1. Edoardo Di Porto & Vincent Merlin & Sonia Paty, 2013. "Cooperation among local governments to deliver public services : a "structural" bivariate response model with fixed effects and endogenous covariate," Working Papers halshs-00787600, HAL.

    More about this item

    JEL classification:

    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • H7 - Public Economics - - State and Local Government; Intergovernmental Relations

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