Fiscal federalism and lobbying
نویسندگان
چکیده
Article history: Received 18 April 2005 Received in revised form 20 March 2008 Accepted 7 May 2008 Available online 24 May 2008 Which government functions should be decentralized (resp. centralized) once lobbying behavior is taken into account?We find that the answer largely depends on how the interests of the regional lobbies are positioned with respect to the function to be decentralized (resp. centralized). When regional lobbies have conflicting interests, then lobbying is less damaging for social welfare under centralization than under decentralization. On the contrary, when regional lobbies have aligned interests, then lobbying is less damaging for social welfare under decentralization, provided that policy spillovers on the non-organized groups are not too strong. © 2008 Elsevier B.V. All rights reserved. JEL classification: D70 H23 H77
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