The influence of decentralized taxes and intergovernmental grants on local spending volatility
| Autor: | Agnese Sacchi, Simone Salotti |
|---|---|
| Jazyk: | angličtina |
| Rok vydání: | 2017 |
| Předmět: |
Macroeconomics
local revenues jel:E62 05 social sciences General Social Sciences Monetary economics jel:H71 jel:H77 0506 political science jel:R50 Public spending Tax revenue local spending volatility local revenues property taxes intergovernmental grants local spending volatility property taxes intergovernmental grants Incentive Regional studies 0502 economics and business 050602 political science & public administration Economics 050207 economics Volatility (finance) General Environmental Science |
| Popis: | Sacchi A. and Salotti S. The influence of decentralized taxes and intergovernmental grants on local spending volatility, Regional Studies. This paper studies what affects the volatility of sub-central public spending in 20 Organisation for Economic Co-operation and Development (OECD) countries. The evidence based on data from 1972 to 2007 shows that the volatility of intergovernmental grants from upper levels is positively associated with the volatility of local expenditure. On the other hand, the volatility of local tax revenues – mainly that of property taxes – exerts the opposite effect. These findings suggest that making local governments rely more on grants than own tax revenues adversely affects their spending stability. Allowing them to levy autonomously taxes relying on responsive tax bases provides incentives to smooth their expenditure. |
| Databáze: | OpenAIRE |
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