Decentralized Fiscal Federalism Revisited: Optimal Income Taxation and Public Goods under Horizontal Leadership

Thomas Aronsson () and Lars Persson ()
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Thomas Aronsson: Department of Economics, Umeå University, Postal: S 901 87 Umeå, Sweden
Lars Persson: Department of Economics, Umeå University, Postal: S 901 87 Umeå, Sweden

No 839, Umeå Economic Studies from Umeå University, Department of Economics

Abstract: This paper concerns optimal taxation and public goods in an economic federation with decentralized leadership, where one lower level government is first mover also in the horizontal dimension. Under plausible assumptions, horizontal leadership reinforces the incentives created by decentralized leadership.

Keywords: Optimal taxation; redistribution; public goods; fiscal federalism; decentralized leadership; horizontal leadership (search for similar items in EconPapers)
JEL-codes: D31 D60 D82 H21 (search for similar items in EconPapers)
Pages: 8 pages
Date: 2012-02-23
New Economics Papers: this item is included in nep-pbe and nep-ure
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Citations: View citations in EconPapers (2)

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