Fiscal equalization and lobbying

Alejandro Esteller-Moré (), Umberto Galmarini () and Leonzio Rizzo ()
Additional contact information
Alejandro Esteller-Moré: Universitat de Barcelona
Umberto Galmarini: Institut d’Economia de Barcelona (IEB)

International Tax and Public Finance, 2017, vol. 24, issue 2, No 3, 247 pages

Abstract: Abstract Inter-regional redistribution through tax-base equalization transfers is examined in a setting in which taxpayers, organized as lobby groups, influence policy making. With lobbying only at the local level on tax rates, social welfare maximization implies, ceteris paribus, high (low) equalization rates on the tax bases backed by the strong (weak) lobby groups. With lobbying also at the central level, equalization is distorted downward on all tax bases if the pressure groups are similar in terms of lobbying power. It is instead distorted downward (upward) on the bases backed by strong (weak) groups if they are highly heterogeneous. In the latter situation, a uniform equalization structure may perform better than a differentiated one.

Keywords: Fiscal-capacity equalization transfers; Special interest groups; Inter-regional redistribution; Equity-efficiency trade-off; Uniform versus differentiated equalization (search for similar items in EconPapers)
JEL-codes: D72 H21 H77 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://link.springer.com/10.1007/s10797-016-9415-2 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:itaxpf:v:24:y:2017:i:2:d:10.1007_s10797-016-9415-2

Ordering information: This journal article can be ordered from
http://www.springer. ... ce/journal/10797/PS2

DOI: 10.1007/s10797-016-9415-2

Access Statistics for this article

International Tax and Public Finance is currently edited by Ronald B. Davies and Kimberly Scharf

More articles in International Tax and Public Finance from Springer, International Institute of Public Finance Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().