The impact of intergovernmental fiscal tools on local service decision: the Nebraska case for water and wastewater systems

Yunseung Kim and Jiseul Kim

Local Government Studies, 2025, vol. 51, issue 3, 547-575

Abstract: This study examines the impact of federal funding on local spending for water and wastewater infrastructure (hereafter ‘W&WI’) in Nebraska. The recent deterioration of W&WI creates potential risks to citizens’ lives. The federal government operates several programmes to assist with W&WI improvements. However, funding is limited, while there are substantial demands for funding. To understand the fiscal impact of intergovernmental aid on local expenditures, this study utilised panel data from 2010 to 2018 for 129 Nebraska municipalities with population over 800 that have water and wastewater systems. This study finds some evidence of the stimulating (‘flypaper’) effect of federal aid on local expenditures. However, in disaggregated models, the aid has crowd-out effects on specific types of spending (e.g. operating expenses). The findings can contribute to policymakers’ understanding of the impact of federal funding programmes and suggest directions for improvement of these tools.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/03003930.2024.2361757 (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:taf:flgsxx:v:51:y:2025:i:3:p:547-575

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/flgs20

DOI: 10.1080/03003930.2024.2361757

Access Statistics for this article

Local Government Studies is currently edited by Helen Hancock

More articles in Local Government Studies from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().