Fiscal Transfers a Curse or Blessing? Evidence of Their Effect on Tax Effort for Municipalities in Sinaloa, Mexico
This article studies the impact of vertical fiscal transfers on local tax effort in Mexico, considering evidence for municipalities in Sinaloa between 1993 and 2008. Based on cadastral information, gross added value and property taxes we create a “pure” indicator of fiscal effort which is used to analyze the effect of conditional and unconditional transfers on this indicator. We employ econometric techniques such as panel data and the Arellano Bond method to correct endogeneity. The results show that conditional transfers, which began in 1998, have generated laziness towards property tax collection, negatively affecting the fiscal effort, even after controlling for demographic factors, population and the index of exclusion.
|Date of creation:||01 Oct 2010|
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"Un repaso de conceptos sobre capacidad y esfuerzo fiscal, y su aplicación para los gobiernos locales mexicanos
[An Overview of Current Concepts of the fiscal capacity and effort, and its applicatio," MPRA Paper 50451, University Library of Munich, Germany.
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- Abhijit Sen Gupta, 2007. "Determinants of Tax Revenue Efforts in Developing Countries," IMF Working Papers 07/184, International Monetary Fund.
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