Vertical Fiscal Transfers and the Location of Economic Activity across a Country Regions.Theory and Evidence for Argentina

Pedro Moncarz, Sebastian Freille, Alberto Figueras and Marcelo Capello
Additional contact information
Alberto Figueras: Universidad Nacional de Córdoba
Marcelo Capello: Universidad Nacional de Córdoba; IERAL de Fundación Mediterránea

No 2410, Documentos de Trabajo (working papers) from Department of Economics - dECON

Abstract: Argentina has an important system of vertical transfers with a compensatory aim including the convergence across sub-national regions. However, there still exist high levels of asymmetries among the country provinces. Extending Martin and Rogers’ FCM including non- tradable goods and public employment we analyse the effect on economic activity location that follows to changes on the regional distribution of transfers. An increase in the share of transfers a region receives positively effect the production of manufactures the higher are: transaction costs of goods produced under increasing returns to scale; the share of transfers that goes directly to consumers instead of local governments; the elasticity of substitution between differentiated goods; the share of consumers’ expenditure on manufactures via-as-vis on non- traded goods.

Keywords: federalism; vertical fiscal transfers; economic location (search for similar items in EconPapers)
JEL-codes: H71 H72 R12 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2010-11
New Economics Papers: this item is included in nep-cis, nep-geo, nep-pbe and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://hdl.handle.net/20.500.12008/2178 (application/pdf)

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:ude:wpaper:2410

Access Statistics for this paper

More papers in Documentos de Trabajo (working papers) from Department of Economics - dECON Contact information at EDIRC.
Bibliographic data for series maintained by Andrea Doneschi () and ().