This paper examines whether local public expenditures on services to functionally impaired individuals crowd out other local public expenditures in Sweden. Over the last ten years, these expenditures have increased by more than 90 percent while other municipal expenditures have experienced...

The thesis consists of an introductory part and three self-contained papers. <p> Paper [I] studies the determinants of the differences in expenditure on services for functionally impaired individuals among municipalities in Sweden. A spatial autoregressive model is used in order to test whether the...</p>