Let's stay in touch - Evidence on the role of social learning in local tax interactions
Sebastian Blesse and
Thorsten Martin ()
Annual Conference 2016 (Augsburg): Demographic Change from Verein für Socialpolitik / German Economic Association
This paper exploits detailed information on local political and socioeconomic networks and a reform of local fiscal equalization in North Rhine-Westphalia (NRW) to identify the role of learning in local tax rate interactions. Using this policy change in spatial lag IV regressions, we find that institutions like counties and jointly used administrations yield significant positive tax interactions whereas geographical neighbors do not react to each other. Common local media trigger tax policy interactions as well. Short-lived reform effects support our findings that social learning within certain networks intensifies tax rate interactions via coordination of local decision makers.
JEL-codes: H20 H71 H77 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-pbe, nep-soc and nep-ure
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Working Paper: Let's stay in touch - evidence on the role of social learning in local tax interactions (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc16:145614
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