Do local government fiscal spillovers exist? Evidence from counties, municipalities, and school districts

Adam Isen

Journal of Public Economics, 2014, vol. 110, issue C, 57-73

Abstract: Numerous theories posit that the fiscal decisions of one jurisdiction influence the fiscal decisions of its neighbors. The main contribution of this paper is to address empirical difficulties in testing for spillovers using a regression discontinuity design on a newly collected dataset. I utilize close elections from this large dataset of local referenda in Ohio to isolate the effect of exogenous increases in taxation and spending of one jurisdiction on neighbors' fiscal decisions. For all jurisdictional types and referenda revenue sources (bonds, income, property, and sales tax), there is no evidence of spillovers, and relatively small effects can be ruled out.

Keywords: Fiscal spillovers; Inter-jurisdictional competition; Taxes and spending (search for similar items in EconPapers)
JEL-codes: H2 H3 H4 H7 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (51)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:pubeco:v:110:y:2014:i:c:p:57-73

DOI: 10.1016/j.jpubeco.2013.12.005

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