Switch towards tax centralization in Italy: A wake up for the local political budget cycle

Massimiliano Ferraresi (), Umberto Galmarini (), Leonzio Rizzo () and Alberto Zanardi ()
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Umberto Galmarini: University of Insubria & IEB
Alberto Zanardi: Italian Parliamentary Budget Office

No 2016/21, Working Papers from Institut d'Economia de Barcelona (IEB)

Abstract: The abolition of the municipal property tax on owner-occupied dwellings accomplished in Italy in 2008 offers a quasi-natural experiment that allows for the identification of the presence of political budget cycles - the incentives for municipalities close to elections to manipulate policy outcome decisions. Our empirical analysis shows that the reform impacted on municipalities that in 2008 were in their pre-electoral year, by expanding the size of their budget in the form of an increase of current expenditure and fees and charges, but this did not occurred in municipalities that experienced their pre-electoral year before 2008.

Keywords: Political budget cycle; transfers; federal budget; property tax; fiscal reform; local elections. (search for similar items in EconPapers)
JEL-codes: C3 H71 H72 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2016
New Economics Papers: this item is included in nep-pbe
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Switch toward tax centralization in Italy: a wake-up for the local political budget cycle (2019)
Working Paper: Switch towards tax centralization in Italy: a wake up for the local political budget cycle (2016)
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