Fiscal Competition among Local Governments: The Issue of Municipal Overburden

Fiscal competition in health spending among local governments in the Philippines.

The Philippines is one of several Asian countries that has decentralized the provision of health care to its local governments in recent decades. In the context of decentralization, a few studies have previously examined the issue of fiscal competition among local governments in the developing world. This report presents a summary of a published study that examined the existence of inter-jurisd...

The taming of Leviathan: Competition among governments

Causes of Fiscal Crises in State and Local Governments

Financial insolvency is a rare occurrence in American state and local governments. However, when it does happen, as in the case of Detroit’s historical bankruptcy filing in 2013, the consequences for vital city services, public employees, and taxpayers can be devastating. This essay reviews existing and emerging research on the causes of government fiscal crises, paying particular attention to ...

Fiscal stringency and fiscal sustainability: Panel evidence from the American state and local governments

Most state (and local) governments in the U.S. operate under formal fiscal rules which limit their ability to run budget deficits and resort to debt financing. A priori, one would expect to find evidence in favor of an intertemporally balanced budget, or fiscal sustainability, for these states, especially those characterized by a relatively high degree of fiscal stringency. We test this hypothe...

Tax mimicking and yardstick competition among local governments in the Netherlands

This paper provides a spatial-econometric analysis of the setting of property tax rates by Dutch municipalities. We find evidence of tax mimicking: a ten percent higher property tax rate in neighboring municipalities leads to a 3.5 percent higher tax rate. Mimicking is less pronounced in municipalities governed by coalitions backed by a large majority. This points to yardstick competition as th...