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Expenditure competition

Author: Roger H Gordon; John D Wilson; National Bureau of Economic Research.
Publisher: Cambridge, MA. : National Bureau of Economic Research, ©2001.
Series: Working paper series (National Bureau of Economic Research), no. 8189.
Edition/Format:   eBook : Document : EnglishView all editions and formats
Database:WorldCat
Summary:
Abstract: Given the temptation on government officials to use some of their budget for 'perks, ' residents face the problem of inducing officials to reduce such 'waste.' The threat to vote out of office officials who perform poorly is one possible response. In this paper, we explore the effect that competition for residents induced by fiscal decentralization has on 'waste' in government. We find not only that such  Read more...
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Details

Material Type: Document, Internet resource
Document Type: Internet Resource, Computer File
All Authors / Contributors: Roger H Gordon; John D Wilson; National Bureau of Economic Research.
OCLC Number: 60331348
Description: 1 online resource (20 pages).
Series Title: Working paper series (National Bureau of Economic Research), no. 8189.
Responsibility: Roger H. Gordon, John D. Wilson.

Abstract:

Abstract: Given the temptation on government officials to use some of their budget for 'perks, ' residents face the problem of inducing officials to reduce such 'waste.' The threat to vote out of office officials who perform poorly is one possible response. In this paper, we explore the effect that competition for residents induced by fiscal decentralization has on 'waste' in government. We find not only that such competition reduces waste and raises the utility of residents, but also that it should increase the desired level of public expenditures, and to a point above the level that jurisdictions would choose if they could coordinate. These results are in sharp contrast to the presumed effects from such 'tax competition, ' and suggest an additional advantage of fiscal decentralization.

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