Taxing our neighbors? : why some sub-national revenues are so small
Date
2010-03
Authors
Baldrich, Jorge
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Journal Title
Journal ISSN
Volume Title
Publisher
Universidad de San Andrés. Departamento de Economía
Abstract
This paper analyzes the determinants of local government revenues and the incentives
faced by politicians in the design of tax policy. The decision of deepening local tax
collections carries costs and benefits for local politicians. Balancing in the margin these
costs and benefits allows for an endogenous determination of the taxing level. The paper
stresses the role of markets size in determining politicians’ incentives to enact a tax
regime. In addition, we provide a rationale for the central government-local government
tax ratio as a key tax effort variable. Furthermore, local levels of income inequality are
relevant in explaining tax collections.
Description
Fil: Baldrich, Jorge. Universidad de San Andrés. Departamento de Economía; Argentina.