Central governments often subsidize capital spending by local governments, instead of subsidizing operating expenses or labor-intensive projects. This paper offers one explanation, focusing on the incentive effects for local officials—a local official can more easily shift the cost of optimizing a project to his successor on a labor-intensive project than on a capital-intensive project.

Abstract An influential result in the literature on charitable giving is that matching subsidies dominate rebate raising funds. We investigate whether this extends to “unit donation” schemes, a popular alternative form of soliciting donations. There, donors’ choices are over number units good fund at given unit price, rather than amount money give. Comparing matches and rebates as well simple d...

The rapid market uptake of battery and hybrid electric cars in Norway is unparalleled. We examine the fiscal policy instruments behind this development. In essence, Norwegian consists taxing internal combustion engine vehicles rather than subsidizing ones. There are 14 different incentives place bearing on vehicles, fuel, or road use. All them some way CO2-differentiated. tradition positive eco...