What Determines the Allocation of National Government Grants to the States?
During the New Deal the federal government initiated a policy of massive grants to states for support of social welfare and other programs. Since that time grants have come to be an integral part of the American fiscal system, and scholars have continued to debate whether the allocation of federal grants between the states is motivated primarily by political or social and economic objectives. This paper shows that, during the 1930s, both political and economic effects were important determinants of grant allocation, but that the Congressional factors considered by Anderson and Tollison are not important while the Presidential factors considered by Wright are. When the analysis is extended to the years 1932 to 1982, however, Congressional influences do seem important. On the other hand, the dominant influence on federal grant policy over the larger sample appears to be state government expenditures, while both political and economic influences play a smaller role.
|Date of creation:||Jul 1996|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Wright, Gavin, 1974. "The Political Economy of New Deal Spending: An Econometric Analysis," The Review of Economics and Statistics, MIT Press, vol. 56(1), pages 30-38, February.
- Wallis, John Joseph, 1987. "Employment, Politics, and Economic Recovery during the Great Depression," The Review of Economics and Statistics, MIT Press, vol. 69(3), pages 516-520, August.
- Wallis, John Joseph, 1991. "The Political Economy of New Deal Fiscal Federalism," Economic Inquiry, Western Economic Association International, vol. 29(3), pages 510-524, July.
- Wallis, John Joseph, 1989. "Employment in the Great Depression: New data and hypotheses," Explorations in Economic History, Elsevier, vol. 26(1), pages 45-72, January.
- Mel Bungey & Peter Kenyon & Philip J. Grossman, 1991. "Explaining intergovernmental grants: Australian evidence," Monash Economics Working Papers archive-14, Monash University, Department of Economics.
- Alston, Lee J & Ferrie, Joseph P, 1993. "Paternalism in Agricultural Labor Contracts in the U.S. South: Implications for the Growth of the Welfare State," American Economic Review, American Economic Association, vol. 83(4), pages 852-876, September.
- Reading, Don C., 1973. "New Deal Activity and the States, 1933 to 1939," The Journal of Economic History, Cambridge University Press, vol. 33(04), pages 792-810, December.
- Craig, Steven G & Inman, Robert P, 1982. "Federal Aid and Public Education: An Empirical Look at the New Fiscal Federalism," The Review of Economics and Statistics, MIT Press, vol. 64(4), pages 541-552, November.