A structural approach for analyzing fiscal equalization

Audun Langørgen

Discussion Papers from Statistics Norway, Research Department

Abstract: Many countries apply cost-equalization and/or fiscal capacity equalization formulas to enable sub-national governments to provide comparable service standards at comparable tax rates. This paper demonstrates how measures of expenditure needs and fiscal capacity can be derived from a structural model of local government spending and taxing behavior. The structural parameters are shown to provide the information required to implement equalization according to the principle of horizontal equity.

Keywords: Fiscal Equalization; Expenditure Needs; Fiscal Capacity; Structural Modeling (search for similar items in EconPapers)
JEL-codes: H71 H72 (search for similar items in EconPapers)
Date: 2012-11
New Economics Papers: this item is included in nep-pbe and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: A structural approach for analyzing fiscal equalization (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:ssb:dispap:715

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