IDEAS home Printed from https://ideas.repec.org/p/ags/wisagr/12635.html
   My bibliography  Save this paper

Convergence in Local Government Spending: Evidence from Wisconsin

Author

Listed:
  • Deller, Steven C.
  • Skidmore, Mark

Abstract

A substantial body of theoretical and empirical evidence demonstrates that interregional competition for factors of production leads to convergence of per capita output. Is there an analogous process that leads to convergence of public sector activity? Skidmore, et al (2004) develop a model that is consistent with the macroeconomic growth literature, which predicts convergence in government spending. Based on this framework, we test for convergence in government spending using detailed data from Wisconsin for a variety of municipal government expenditure categories over the 1989/90-1999/2000 period. Our empirical investigation provides compelling evidence of convergence in capita government spending for all the expenditure categories we study. This work adds to the growing body of evidence demonstrating the existence of underlying dynamic forces that determine growth of government.

Suggested Citation

  • Deller, Steven C. & Skidmore, Mark, 2005. "Convergence in Local Government Spending: Evidence from Wisconsin," Staff Papers 12635, University of Wisconsin-Madison, Department of Agricultural and Applied Economics.
    • Handle: RePEc:ags:wisagr:12635
    DOI: 10.22004/ag.econ.12635
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/12635/files/stpap483.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.12635?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    2. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    3. Brennan,Geoffrey & Buchanan,James M., 2006. "The Power to Tax," Cambridge Books, Cambridge University Press, number 9780521027922.
    4. Steven C. Deller & Tsung-Hsiu (Sue) Tsai & David W. Marcouiller & Donald B.K. English, 2001. "The Role of Amenities and Quality of Life In Rural Economic Growth," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 83(2), pages 352-365.
    5. Howard R. Bowen, 1943. "The Interpretation of Voting in the Allocation of Economic Resources," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 58(1), pages 27-48.
    6. Mark Skidmore & Hideki Toya & David Merriman, 2004. "Convergence in Government Spending: Theory and Cross‐Country Evidence," Kyklos, Wiley Blackwell, vol. 57(4), pages 587-620, November.
    7. Charles M. Tiebout, 1956. "A Pure Theory of Local Expenditures," Journal of Political Economy, University of Chicago Press, vol. 64, pages 416-416.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Yusniliyana Yusof & Kaliappa Kalirajan & Azhar Mohamad, 2022. "Fiscal decentralization and convergence in government spending in Malaysia," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 27(3), pages 2669-2681, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Martinez-Vazquez, Jorge & McNab, Robert M., 2003. "Fiscal Decentralization and Economic Growth," World Development, Elsevier, vol. 31(9), pages 1597-1616, September.
    2. Saeid Mahdavi & Joakim Westerlund, 2017. "Are state–local government expenditures converging? New evidence based on sequential unit root tests," Empirical Economics, Springer, vol. 53(2), pages 373-403, September.
    3. Thushyanthan Baskaran & Lars P. Feld & Jan Schnellenbach, 2014. "Fiscal Federalism, Decentralization and Economic Growth: Survey and Meta-Analysis," CESifo Working Paper Series 4985, CESifo.
    4. Jorge Martinez-Vazquez & Robert McNab, 1997. "Fiscal Decentralization, Economic Growth, and Democratic Governance," International Center for Public Policy Working Paper Series, at AYSPS, GSU paper9707, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
    5. Stojcic, Nebojsa & Suman Tolic, Meri, 2018. "Direct and indirect effects of fiscal decentralisation on economic growth," MPRA Paper 108762, University Library of Munich, Germany, revised May 2019.
    6. Daniel C. Monchuk & John A. Miranowski & Dermot J. Hayes & Bruce A. Babcock, 2007. "An Analysis of Regional Economic Growth in the U.S. Midwest," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 29(1), pages 17-39.
    7. Sanz Labrador, Ismael & Sanz-Sanz, José Félix, 2013. "Política fiscal y crecimiento económico: consideraciones microeconómicas y relaciones macroeconómicas," Macroeconomía del Desarrollo 5367, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    8. Åsa Johansson, 2016. "Public Finance, Economic Growth and Inequality: A Survey of the Evidence," OECD Economics Department Working Papers 1346, OECD Publishing.
    9. Whitney Buser, 2011. "The impact of fiscal decentralization on economics performance in high-income OECD nations: an institutional approach," Public Choice, Springer, vol. 149(1), pages 31-48, October.
    10. Mauro, Luciano & Pigliaru, Francesco & Carmeci, Gaetano, 2018. "Decentralization and growth: Do informal institutions and rule of law matter?," Journal of Policy Modeling, Elsevier, vol. 40(5), pages 873-902.
    11. Tsovinar J. Karapetyan & Arpenik Muradyan & Vanine A. Yeranosyan & Erik M. Grigoryan, 2021. "The structural changes in Armenian Community budgets within the process of community consolidation," Regional Science Policy & Practice, Wiley Blackwell, vol. 13(3), pages 559-572, June.
    12. Thushyanthan Baskaran & Lars P. Feld & Jan Schnellenbach, 2016. "Fiscal Federalism, Decentralization, And Economic Growth: A Meta-Analysis," Economic Inquiry, Western Economic Association International, vol. 54(3), pages 1445-1463, July.
    13. Otto Brøns-Petersen, 2017. "30 Years of Tax Reforms: How Much Impact on Danish Growth?," Palgrave Macmillan Studies in Banking and Financial Institutions, in: Dimitrios D. Thomakos & Konstantinos I. Nikolopoulos (ed.), Taxation in Crisis, chapter 6, pages 121-144, Palgrave Macmillan.
    14. Han, Yutao & Pieretti, Patrice & Zanaj, Skerdilajda & Zou, Benteng, 2014. "Asymmetric competition among nation states: A differential game approach," Journal of Public Economics, Elsevier, vol. 119(C), pages 71-79.
    15. William J. Hunter, 1983. "Tax Structure and Bureaucratic Bargaining," Public Finance Review, , vol. 11(3), pages 347-364, July.
    16. Canavire-Bacarreza, Gustavo & Martinez-Vazquez, Jorge & Yedgenov, Bauyrzhan, 2020. "Identifying and disentangling the impact of fiscal decentralization on economic growth," World Development, Elsevier, vol. 127(C).
    17. Randall Holcombe & DeEdgra Williams, 2011. "The cartelization of local governments," Public Choice, Springer, vol. 149(1), pages 65-74, October.
    18. Henryk Wnorowski, 2010. "Wpływ podatków na wzrost gospodarczy i konkurencyjność w ujęciu instytucjonalnym," Gospodarka Narodowa. The Polish Journal of Economics, Warsaw School of Economics, issue 4, pages 47-65.
    19. Ted Bergstrom & Judy Roberts & Dan Rubinfeld & Perry Shapiro, 1988. "A Test for Efficiency in the Supply of Local Public Education," Papers _036, University of Michigan, Department of Economics.
    20. Christian Leßmann, 2006. "Fiscal Decentralization and Regional Disparity: A Panel Data Approach for OECD Countries," ifo Working Paper Series 25, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.

    More about this item

    Keywords

    Political Economy;

    JEL classification:

    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:wisagr:12635. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/dauwius.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.